#15.14

The partnership of Wingler, Norris, Rodgers, and Guthrie was formed several years ago as a local architectural firm. Several partners have recently undergone personal financial problems and have decided to terminate operations and liquidate the business. The following balance sheet is drawn up as a guideline for this process:

When the liquidation commenced, liquidation expenses of $11,000 were anticipated as being necessary to dispose of all property.

Part A

Prepare a predistribution plan for this partnership.

Part B

The following transactions transpire during the liquidation of the Wingler, Norris, Rodgers, and Guthrie partnership:

1. Collected 90 percent of the total accounts receivable with the rest judged to be uncollectible.
2. Sold the land, building, and equipment for $151,000.
3. Distributed safe payments of cash.
4. Learned that Guthrie, who has become personally insolvent, will make no further contributions.
5. Paid all liabilities.
6. Sold all inventory for $72,000.
7. Distributed safe payments of cash again.
8. Paid actual liquidation expenses of $5,000 only.
9. Made final cash disbursements to the partners based on the assumption that all partners other than Guthrie are personally solvent.

Prepare journal entries to record these liquidation transactions.

Cash Accounts receivable Inventory Land Building and equipment (net) $ 17,000 Liabilities 84,000 Rodgers, loan 103,000 Wingler, capital (30%) 86,000 Norris, capital (10%) 169,000 Rodgers, capital (20%) Guthrie, capital (40%) $459,000 Total liabilities and capital $ 75,000 37,000 123,000 90,000 75,000 59,000 $459,000 Total assets Required A Required B Prepare a predistribution plan for this partnership. (Do not round intermediate calculations.) Wingler, Capital Norris, Capital Rodgers, Loan and Capital Guthrie, Capital Beginning balances Assumed loss of Schedule 1 Step one balances Assumed loss of Schedule 2 Step two balances Assumed loss of Schedule 3 Step three balances Required A Required B > Required A Required B Prepare journal entries to record these liquidation transactions. (Do not round intermediate calculations. Round the final answers to nearest dollar amounts. If no entry is required for a particular transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 5 6 7 8 9 10 Record the cash received from accounts receivable and loss allocated to partners. Note: Enter debits before credits. General Journal Debit Credit Transaction 01 Record entry Clear entry View general journal