P.1 The NOR Partnership is being liquidated. A balance sheet prepared prior to liquidation is presented below:

Assets Liabilities & Equities

Cash $240,000 Liabilities $ 160,000

Other Assets 300,000 Rice, Loan 60,000

Nutt, Capital 180,000

Ohm, Capital 60,000

Rice, Capital 80,000

Total Assets $540,000 Total Equities $540,000

Nutt, Ohm, and Rice share profits and losses in a 40:40:20 ratio. All partners are personally insolvent.

Required:

A. Prepare the journal entries necessary to record the distribution of the available cash.

B. Prepare the journal entries necessary to record the completion of the liquidation process, assuming the other assets are sold for $120,000.