Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows.

KENDRA, COGLEY, AND MEI Balance Sheet May 31
Assets				Liabilities and Equity
Cash	$	100,000		Accounts payable	$	254,000
Inventory		537,000		Kendra, Capital		76,600
				Cogley, Capital		172,350
				Mei, Capital		134,050
Total assets	$	637,000		Total liabilities and equity	$	637,000
Required: For each of the following scenarios, complete the schedule allocating the gain or loss on the sale of inventory. Prepare journal entries to record the below transactions. (Do not round intermediate calculations. Amounts to be deducted or Losses should be entered with a minus sign. Round your final answers to the nearest whole dollar.) (1) Inventory is sold for $615,600. (2) Inventory is sold for $477,600. (3) Inventory is sold for $353,400 and any partners with capital deficits pay in the amount of their deficits. (4) Inventory is sold for $279,600 and the partners have no assets other than those invested in the partnership. Complete this question by entering your answers in the tabs below. Required 1 Inventory Complete the schedule allocating the gain or loss on the sale of inventory is $615,600.

Step 1) Determination of Gain (Loss)
Proceeds from the sale of inventory		$615,600
Inventory cost		537,000
Gain on sale		$78,600
Step 2) Allocation of the Gain (Loss) to the Partners.
		KENDRA		COGLEY		MEI	Total
Initial capital balances		$76,600		$172,350		$134,050	$383,000
Allocation of gains (losses)	3 / 6		2 / 6		1 / 6		0
Capital balances after gains (losses)		$76,600		$172,350		$134,050	$383,000

Required 1 GJ

Journal entry worksheet

Record the sale of inventory.

Transaction

General Journal

Debit

Credit

(a)

Journal entry worksheet

Allocate the gain(loss) on the sale of inventory to the partners.

Transaction

General Journal

Debit

Credit

(b)
Journal entry worksheet Record the payment of the liabilities.

Transaction

General Journal

Debit

Credit

(c)

Journal entry worksheet

Record the disbursement of the remaining cash to the partners.

Transaction

General Journal

Debit

Credit

(d)

Required 2 Inventory

Complete the schedule allocating the gain or loss on the sale of inventory is $477,600.

Step 1) Determination of Gain (Loss)
Proceeds from the sale of inventory		$477,600
Inventory cost
Step 2) Allocation of the gain (Loss) to the Partners.
		KENDRA		COGLEY		MEI	Total
Initial capital balances		$76,600		$172,350		$134,050	$383,000
Allocation of gains (losses)	3 / 6		2 / 6		1 / 6		0
Capital balances after gains (losses)		$76,600		$172,350		$134,050	$383,000

Required 2 GJ

Prepare journal entries to record the inventory is sold for $477,600.

No

Transaction

General Journal

Debit

Credit

Journal entry worksheet

Record the sale of inventory.

Transaction

General Journal

Debit

Credit

(a)

Journal entry worksheet

Allocate the gain(loss) on the sale of inventory to the partners.

Transaction

General Journal

Debit

Credit

(b)
Journal entry worksheet Record the payment of the liabilities.

Transaction

General Journal

Debit

Credit

(c)

Journal entry worksheet

Record the disbursement of the remaining cash to the partners..

Transaction

General Journal

Debit

Credit

(d)

Required 3 Inventory

Complete the schedule allocating the gain or loss on the sale of inventory is $353,400 and any partners with capital deficits pay in the amount of their deficits.

Step 1) Determination of Gain (Loss)
Proceeds from the sale of inventory		$353,400
Inventory cost
Step 2) Allocation of the Gain (Loss) to the Partners.
		KENDRA		COGLEY		MEI	Total
Initial capital balances		$76,600		$172,350		$134,050	$383,000
Allocation of gains (losses)	3 / 6		2 / 6		1 / 6		0
Capital balances after gains (losses)		$76,600		$172,350		$134,050	$383,000

Required 3 GJ

Prepare journal entries to record the inventory is sold for $353,400 and any partners with capital deficits pay in the amount of their deficits.

No	Transaction	General Journal	Debit	Credit

Required 4 Inventory

Complete the schedule allocating the gain or loss on the sale of inventory $279,600 and the partners have no assets other than those invested in the partnership.

Step 1) Determination of gain (loss)
Proceeds from the sale of inventory		$279,600
Inventory Cost
Step 2) Allocation of the gain (loss) to the partners and distribution of deficit(s)
		KENDRA		COGLEY		MEI	Total
Initial capital balances		$76,600		$172,350		$134,050	$383,000
Allocation of gains (losses)							0
Capital balances after gains (losses)		76,600		172,350		134,050	383,000
							0
Capital balances after deficit allocation		$76,600		$172,350		$134,050	$383,000

Required 4 GJ

Prepare journal entries to record the inventory is sold for $279,600 and the partners have no assets other than those invested in the partnership.

No	Transaction	General Journal	Debit	Credit

Journal entry worksheet

Record the sale of inventory for $279,600.

Transaction

General Journal

Debit

Credit

(a)

Journal entry worksheet

Record the allocation of the gain or loss on the sale of inventory to the partners.

Transaction

General Journal

Debit

Credit

Assuming that the partners have no assets other than those invested, allocate any partner(s) deficit balances to the remaining partners.

Transaction

General Journal

Debit

Credit

(c)

Journal entry worksheet

Record the payment of the liabilities.

Transaction

General Journal

Debit

Credit

(d)

Journal entry worksheet

Record the disbursement of the remaining cash to the partner(s).

Transaction

General Journal

Debit

Credit

(e)