Question
On January 1, 2011, the partners of W, C, and D (who shared profits and losses in the ratio of 5:3:2, respectively) decided to liquidate
On January 1, 2011, the partners of W, C, and D (who shared profits and losses in the ratio of 5:3:2, respectively) decided to liquidate their partnership. The trial balance at this date was as follows:
DEBITS
CASH - 23,400
A/R - 85,800
INVENTIRY - 67,600
MACHINERY & EQUIPMENT - 245,700
WON LOAN - 39,000
TOTAL - 461,500
CREDITS
A/P - 68,900
CADEL, LOAN - 26,000
WON, CAPITAL - 153,400
CADEL, CAPITAL - 117,000
DAX, CAPITAL - 96,200
TOTAL - 461,500
The partners planned a program of piecemeal conversion of the business assets to minimize liquidation losses. All available cash, less an amount retained to provide for future expenses, was to be distributed to the partners at the end of each month. A summary of liquidation transactions follows:
JANUARY
A. 66,300 WAS COLLECTED ON THE A/R; THE BALANCE WAS DEEMED TO BE UNCOLLECTABLE
B. 49,400 WAS RECEIVED FOR THE ENTIRE INVENTORY
C. 2,600 IN LIQUIDATION EXPENSES WERE PAID
D. 65,000 WAS PAID TO OUTSIDE CREDITORS, AFTER RECEIVING A 3,900 CREDIT MEMO FROM A CREDITOR ON JAN. 11
E. CASH OF 13,000 WAS RETAINED AT THE END OF THE MONTH TO COVER UNRECORDED LIABILITIES AND ANTICIPATED EXPENSES. THE BALANCE OF CASH WAS DISTRIBUTED TO THE PARTNERS
FEBRUARY
A. 3,900 IN LIQUIDATION EXPENSES WERE PAID
B. 7,80 IN CASH WAS RETAINED AT THE END OF THE MONTH TO COVER UNRECORDED LIABILITIES AND ANTICIPATED EXPENSES.
MARCH
A. 189,800 WAS RECEIVED ON THE SALE OF ALL MACHINERY AND EQUIPMENT
B. 6,500 IN FINAL LIQUIDATION EXPENSES WERE PAID
C. NO CASH WAS RETAINED AS ALL CASH WAS DISTRIBUTED TO PARTNERS
Prepare a Schedule of liquidation fro the partnership
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