On October 1, 2010, the firm of Orson, Dorr, and Killough decided to liquidate their partnership. The partners have capital balances of $48,000, $63,000, and $11,000, respectively. The cash balance is $9,000, the book values of noncash assets total $155,000, and liabilities total $42,000. The partners share income and losses in the ratio of 2:2:1. 1. Prepare a statement of partnership liquidation, covering the period October 130, 2010, for each of the following independent assumptions: a. All of the noncash assets are sold for $195,000 in cash, the creditors are paid, and the remaining cash is distributed to the partners. Use the minus sign to indicate any deductions or deficiencies. If an amount is zero or a blank, enter in 0. ORSON, DORR, AND KILLOUGH Statement of Partnership Liquidation For the Period Ending October 1-30, 2010 Cash Noncash Assets Liabilities Capital Orson Dorr Killough Balances before realization $ $ $ $ $ $ Sale of assets and division of gain Balance after realization $ $ $ $ $ $ Payment of liabilities Balance after payment of liabilities $ $ $ $ $ $ Cash distributed to partners Final balances $ $ $ $ $ $ b. All of the noncash assets are sold for $85,000 in cash, the creditors are paid, the partner with the debit capital balance pays the amount owed to the firm, and the remaining cash is distributed to the partners. Use the minus sign to indicate any deductions or deficiencies. If an amount is zero or a blank, enter in 0. ORSON, DORR, AND KILLOUGH Statement of Partnership Liquidation For the Period Ending October 1-30, 2010 Cash Noncash Assets Liabilities Capital Orson Dorr Killough Balances before realization $ $ $ $ $ $ Sale of assets and division of loss Balance after realization $ $ $ $ $ $ Payment of liabilities Balance after payment of liabilities $ $ $ $ $ $ Receipt of deficiency Balances $ $ $ $ $ $ Cash distributed to partners Final balances $ $ $ $ $ $ 2. Assume the partner with the capital deficiency in part (b) above declares bankruptcy and is unable to pay the deficiency. a. Journalize the entries to allocate the partner's deficiency. If an amount box does not require an entry, leave it blank. Account Debit Credit b. Journalize the entries to distribute the remaining cash. If an amount box does not require an entry, leave it blank. Account Debit Credit