On January 1, 20X1, partners Art, Bru, and Chou, who share profits and losses in the ratio of 5:3:2, respectively, decide to liquidate their partnership. The partnership trial balance at this date follows:

DEBIT

Cash $22,000

Accounts Receivable 76,000

Inventory 62,000

Machinery and Equipment (net) 199,000

CREDIT

Accounts Payable $57,000

Art, Capital 98,000

Bru, Capital 120,000

Chou, Capital 84,000

Total $359,000(Debit)

Total $359,000(Credit)

The partners plan a program of piecemeal conversion of assets to minimize liquidation losses. All available cash, less an amount retained to provide for future expenses, is to be distributed to the partners at the end of each month. A summary of the liquidation transactions follows:

January 20X1

1. Collected $59,000 on accounts receivable; the balance is uncollectible.

2. Received $44,000 for the entire inventory.

3. Paid $4,000 liquidation expenses.

4. Paid $52,500 to creditors, after offset of a $4,500 credit memorandum received on January 11, 20X1.

5. Retained $11,000 cash in the business at the end of the month for potential unrecorded liabilities and anticipated expenses.

February 20X1

6. Paid $6,000 liquidation expenses.

7. Retained $5,000 cash in the business at the end of the month for potential unrecorded liabilities and anticipated expenses.

March 20X1

8. Received $156,000 on sale of all items of machinery and equipment.

9. Paid $4,500 liquidation expenses.

10. Retained no cash in the business.

Required:

Prepare a statement of partnership liquidation for the partnership with schedules of safe payments to partners. (Round your answers to nearest whole dollar.)

ABC PARTNERSHIP Statement of Partnership Realization and Liquidation For the period from January 1, 20X1. through March 31, 20X1 Capital Balancos Bru Cash Other Assets Accounts Payable Art Chou Balances before liquidation January 1, 20x1 January transactions: Collection of accounts receivable at a loss Sale of inventory at a loss Liquidation expenses paid Share of credit memorandum Payments to creditors Sate payments to partners February transactions Liquidation expenses paid Safe payments to partners March transactions Sale of MAE at a loss Liquidation expenses paid Payments to partners Balance at end of todation March 31, 20x1 ABC PARTNERSHIP Chou 20% Schedule of Safe Payments to Partners Art Bru 50% 30% Schedule 1: January 31, 20X1 Capital balances Potential Losses and Expenses Allocation of potential deficit Safe payment, January 31, 20X1 Schedule 2: February 27, 20X1 Capital balances Potential Losses and Expenses Allocation of potential deficit Safe payment, February 27, 20X1