Concept explainers
Lump-sum liquidations: liquidation of
Requirement 1
The preparation of statement of partnership realization and liquidation.
Lump-sum liquidations: liquidation of partnership in which all assets are converted into cash within a short time, creditors are paid, and a single lump-sum payment is made to the partners for their capital interests. Partnership may experiences losses on disposal of assets, because it has to make offer below the normal selling price to encourage immediate sales. The partnership attempts to collect receivable has to offer large cash discounts for prompt payments. Any goodwill on the partnership books is generally written off when the partnership begins liquidation because it is no longer a going concern.
Requirement 2
The entry to account the liquidation of BG company.
Want to see the full answer?
Check out a sample textbook solution
Chapter 16 Solutions
ADV.FIN.ACCT. CONNECT+PROCTORIO PLUS
- Compute Lexington taxable income for the yeararrow_forwardEV Corporation reported its financial results for the year ended December 31, 2023. The company generated $320,000 in sales revenue, while the cost of goods sold amounted to $140,000. The company also incurred operating expenses of $92,000 and reported a net income of $88,000. Additionally, the company’s net cash provided by operating activities was $112,500. Based on this information, what was EV Corporation’s profit margin ratio?arrow_forwardI want to this question answer general accountingarrow_forward
College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,