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Part A The partnership of Wingler, Norris, Rodgers, and Guthrie was formed several years ago as a local architectural firm. Several partners have recently undergone

Part A The partnership of Wingler, Norris, Rodgers, and Guthrie was formed several years ago as a local architectural firm. Several partners have recently undergone personal financial problems and have decided to terminate operations and liquidate the business. The following balance sheet is drawn up as a guideline for this process:

Cash $ 65,000 Liabilities $ 54,000

Accounts receivable 132,000 Rodgers, loan 85,000

Inventory 151,000 Wingler, capital (30%) 195,000

Land 110,000 Norris, capital (10%) 138,000

Building and equipment (net) 193,000 Rodgers, capital (20%) 99,000

Guthrie, capital (40%) 80,000

Total assets $ 651,000 Total liabilities and capital $ 651,000

When the liquidation commenced, liquidation expenses of $20,000 were anticipated as being necessary to dispose of all property. Prepare a predistribution plan for this partnership.

Part B

The following transactions transpire during the liquidation of the Wingler, Norris, Rodgers, and Guthrie partnership:

Collected 90 percent of the total accounts receivable with the rest judged to be uncollectible.

Sold the land, building, and equipment for $175,000.

Made safe capital distributions. L

Learned that Guthrie, who has become personally insolvent, will make no further contributions.

Paid all liabilities.

Sold all inventory for $96,000.

Made safe capital distributions again.

Paid actual liquidation expenses of $14,000 only.

Made final cash disbursements to the partners based on the assumption that all partners other than Guthrie are personally solvent.

Prepare journal entries to record these liquidation transactions.

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