Sedgwick Company at December 31 has cash $20,000, noncash assets $100,000, liabilities $55,000, and the following capital
Question:
Sedgwick Company at December 31 has cash $20,000, noncash assets $100,000, liabilities $55,000, and the following capital balances: Floyd $45,000 and DeWitt $20,000. The firm is liquidated, and $105,000 in cash is received for the noncash assets. Floyd and DeWitt income ratios are 60% and 40%, respectively. Sedgwick Company decides to liquidate the partnership.
Instruction.
Prepare the entries to record:
a. The sale of noncash assets.
b. The allocation of the gain or loss on realization to the partners.
c. Payment of creditors.
d. Distribution of cash to the partners.
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Account titles Explanations Debit Credit a Cash 105000 To non cash assets 100000 To gain on rea...View the full answer
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Related Book For 
Accounting Principles
ISBN: 9781119707110
14th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Jill E. Mitchell
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