Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

After working for in the Kitchen remodeling business for several years. Terry and Phyllis decided to go into business for themselves and formed the Kitchens

image text in transcribed
image text in transcribed
After working for in the Kitchen remodeling business for several years. Terry and Phyllis decided to go into business for themselves and formed the Kitchens Just for You partnership. Three years ago, thoy admitted Connte as a partner and recognized goodwil at that time because of her good client list for planned kitchen makeovers. However, they were not able to gain a sufficient market for new customers and on September 1,20X9, they agreed to dissolve and liquidate the business. They decided on an installment liquidation to complete the projects already initiated. The balance sheet, with profit and loss-sharing percentages at the beginning of liquidation, is as follows: Connie's loan was for working capitat, the loan to Terry was for his unexpected personal medical bilis. During Septomber 209, the first month of nquidation, the parthership colfected $44,000 in recelvables and decided to wite off $3.000 of the remaining recelvables Sales of one half of the book value of the inventory realized a los5 of $7.000. The partners estimate that the costs of liquidating the business (newspaper ads, signs, etc), are expected to be $5.000 for the remainder of the liquidation process. Required: Prepare a schedule of safe payments to parthers as of September 30,209, to show how the avallable cash should be distributed to tho portners Please follow the practical guidelines when completing this worksheet \begin{tabular}{|c|c|c|c|} \hline \multicolumn{4}{|c|}{ KITCHENS JUSTFOR YOU } \\ \hline \multicolumn{4}{|c|}{ Schedule of Safe Payments to Partners } \\ \hline & Terry & Phyllis & Connie \\ \hline \multicolumn{4}{|l|}{ Capital balances, September 1,20X9 } \\ \hline \multicolumn{4}{|l|}{ Loans to (from) partner } \\ \hline \multicolumn{4}{|l|}{ Total } \\ \hline \multicolumn{4}{|l|}{ White-off of goodwill } \\ \hline \multicolumn{4}{|l|}{ Write-off of recervables } \\ \hline \multicolumn{4}{|l|}{ Loss on sale of inventory } \\ \hline \multicolumn{4}{|l|}{ Capital balances, September 30,209} \\ \hline \multicolumn{4}{|l|}{ Possible loss for remaining receivables and inventory } \\ \hline \multicolumn{4}{|l|}{ Possible liquidation costs } \\ \hline \multicolumn{4}{|l|}{ Balances. } \\ \hline \multicolumn{4}{|l|}{ Distribute any potential deficis } \\ \hline Safe payments to partners, September 30,209 & & & \\ \hline \end{tabular}

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_2

Step: 3

blur-text-image_3

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

Currency Internationalization Global Experiences And Implications For The Renminbi

Authors: Wensheng Peng, Chang Shu

2nd Edition

0230580491, 9780230580497

More Books

Students also viewed these Accounting questions