Part B

The following transactions occur in liquidating this business:

Distributed cash based on safe capital balances immediately to the partners. Liquidation expenses of $10,000 are estimated as a basis for this computation.

Sold noncash assets with a book value of $98,000 for $66,000.

Paid all liabilities.

Distributed cash based on safe capital balances again. (Break it down as "First (remainder of first distribution)", Next and Next)

Sold remaining noncash assets for $53,000.

Paid actual liquidation expenses of $8,000 only.

Distributed remaining cash to the partners and closed the financial records of the business permanently.

The partnership of Frick, Wilson, and Clarke has elected to cease all operations and liquidate its business property. A balance sheet drawn up at this time shows the following account balances: $ 66,000 Liabilities Cash Noncash assets $ 46,000 135,000 37,000 79,000 $297,000 231,000 Frick, Wilson, Clarke, capital (60%) capital (20%) capital (20%) Total assets $297,000 Total liabilities and capital