Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Adams, Peters, and Blake share profits and losses for their APB Partnership in a ratio of 2:3:5. When they decide to liquidate, the balance sheet

Adams, Peters, and Blake share profits and losses for their APB Partnership in a ratio of 2:3:5. When they decide to liquidate, the balance sheet is as follows:

Assets Liabilities and Capital
Cash $ 49,000 Liabilities $ 45,500
Adams, Loan 11,800 Adams, Capital 64,900
Other Assets 218,000 Peters, Capital 88,500
Blake, Capital 79,900
Total Assets $ 278,800 Total Liabilities and Equities $ 278,800

Liquidation expenses are expected to be negligible. No interest accrues on loans with partners after termination of the business. During the liquidation process for the APB Partnership, the following events occurred:

  1. During the first month of liquidation, noncash assets with a book value of $89,500 were sold for $68,000, and $22,500 of the liabilities were paid.
  2. During the second month, the remaining noncash assets were sold for $78,000. The loan receivable from Adams was collected, and the rest of the creditors were paid.
  3. Cash is distributed to partners at the end of each month.

Required:

Prepare a statement of partnership realization and liquidation with a schedule of safe payments to partners for the liquidation period. Please follow the practical guidelines when completing this worksheet.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Merchandising Math A Managerial Approach

Authors: Doris Kincade, Fay Gibson, Ginger Woodard

1st Edition

0130995886, 978-0130995889

More Books

Students also viewed these Accounting questions

Question

How should respond to Hsu and Hsu?

Answered: 1 week ago