Data for the Daynen partnership are presented in EF-4. Instructions Prepare the entries to record: (a) The

Question:

Data for the Daynen partnership are presented in EF-4.

Instructions

Prepare the entries to record:

(a) The sale of non-cash assets.

(b) The allocation of the gain or loss on liquidation to the partners.

(d) Distribution of cash to the partners.

Data From EF-4

Daynen Company at December 31 has cash £20,000, non-cash assets £100,000, liabilities £55,000, and the following capital balances: Day £45,000 and Nen £20,000. The firm is liquidated, and £120,000 in cash is received for the non-cash assets. Day and Nen income
ratios are 55% and 45%, respectively.

Distribution
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most... Liquidation
Liquidation in finance and economics is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they are due.... Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...