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Nada, Aisha, Sarah and Khadija have decided to liquidate their partnership. At the time of liquidation the balance sheet was as follows: Cash 12,000 Accounts
Nada, Aisha, Sarah and Khadija have decided to liquidate their partnership. At the time of liquidation the balance sheet was as follows: Cash 12,000 Accounts payable 12,000 Noncash assets 190,000 Nada Capital 15,000 Total assets 202,000 Aisha Capital 75,000 Sarah Capital 75,000 Khadija Capital 25,000 Total liabilities and capital 202,000 Partners Nada, Aisha, Sarah and Khadija share profits/losses according to the ratios 3:3:2:2. During liquidation, the partners sold the noncash assets for 75,000, liabilities were settled and final cash distributions were made. Also during liquidation, it was learned that partners Nada and Khadija were insolvent but the other partners were solvent. Required: 1 - Provide the journal entry made when the noncash assets were sold 2 - State the amounts that were distributed to each partner in the final distribution
| Nada, Aisha, Sarah and Khadija have decided to liquidate their partnership. At the time of liquidation the balance sheet was as follows: | |||||||||
| Cash | 12,000 | Accounts payable | 12,000 | ||||||
| Noncash assets | 190,000 | Nada Capital | 15,000 | ||||||
| Total assets | 202,000 | Aisha Capital | 75,000 | ||||||
| Sarah Capital | 75,000 | ||||||||
| Khadija Capital | 25,000 | ||||||||
| Total liabilities and capital | 202,000 | ||||||||
| Partners Nada, Aisha, Sarah and Khadija share profits/losses according to the ratios 3:3:2:2. | |||||||||
| During liquidation, the partners sold the noncash assets for 75,000, liabilities were settled and final cash distributions were made. | |||||||||
| Also during liquidation, it was learned that partners Nada and Khadija were insolvent but the other partners were solvent. | |||||||||
| Required: | |||||||||
| 1 - Provide the journal entry made when the noncash assets were sold | |||||||||
| 2 - State the amounts that were distributed to each partner in the final distribution | |||||||||
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Financial Accounting
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann
3rd edition
9780077506902, 78025540, 77506901, 978-0078025549
