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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

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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, they admitted Connie as a partner and recognized goodwill 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: Assets Cash Receivables Terry, Loan Inventory Goodwili Total Assets KITCHENS JUST FOR YOU Balance Sheet September 1, 28x9 Liabilities and Equities S 10,000 Accounts Payable 64,290 Connie, Loan 6,000 Terry, Capital (30%) 48,000 Phyllis, Capital (60%) 22,898 Connie, Capital (10%) $150,888 Total Liabilities & Equities $ 50,080 14,000 9,800 43,000 34,000 $150,000 Connie's loan was for working capital the loan to Terry was for his unexpected personal medical bilis During September 20X9, the first month of liquidation, the partnership collected $48,000 in receivables and decided to write off $5,000 of the remaining receivables. Sales of one-half of the book value of the inventory realized a loss of $4,000. The partners estimate that the costs of liquidating the business (newspaper ads, signs, etc.) are expected to be $8,000 for the remainder of the liquidation process ................. liquidation process --- w Required: Prepare a schedule of safe payments to partners as of September 30, 20X9, to show how the available cash should be distributed to the partners. Please follow the practical guidelines when completing this worksheet Phyllis Connie 0 s 0 HOTCHENS JUST FOR YOU Schedule of Sale Payments to Partners Terry Capital balances, September 1, 20X9 Loans to (from) partner Total s 0 s Write-off of goodwill Write-off of receivables Loss on sale of inventory Capital balances September 30, 20X9 $ 0 $ Possible loss for remaining receivables and inventory Possible liquidation costs Balances $ os Distribute any potential deficits Safe payments to partners, September 30, 20X9 $ 0$ 0 $ 0 0 $ 0 0 S

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