Problem 3 Partnership Liquidation On December 2015 Simon and Mark decided to close their SM partnership. The following balance sheet after the 2015 income had been distributed. Assets The partnership's assets were sold at following cash price: Bank 16.416 Land buildings $ 1 800 000, Machine $115200, Inventory $100800 Account Receivables 164.160 Goodwill was fully amortized. Mark wanted to take Motor Vehicle Inventory 106.560 at $144000 for his capital with drawl. Land and buildings 1291968 Motor vehicles 172.800 Account Receivable and Account Payable were fully collected Machinery 86.400 and paid. Gain or Loss from the sale of assets will be distributed Goodwill 248.832 according to profit/loss ratio Simon and Mark at 2:1 Total Assets 2.087.136 a. Prepare the journal entries for the sale and transfer of all Liabilities assets and Goodwill amortization Account payable 155.5201 Cash Loan from Simon 115.200 Inventory Total Liabilities 270.720 Land and buildings Capital Machinery Simon, Capital 1.040.256 Gain-sale of assets Mark, Capital 776.160 Total Capital 1.816.416 Mark Capital Total Liab. & Capital 2.087.136 Loss from MV Motor vehicles b. Prepare the journal entries for collection of Account Receivable and payment of all liabilities Loss from Goodwill amort. Cash Goodwill Account Receivable Net revaluation gain Account Payable Loan from Simon c. Prepare the journal entries for the allocation of Cash Profit/Loss to Simon and Mark Profit/Loss d. Calculate Cash and assets to be distributed Simon capital to Simon & Mark Mark capital Simon Mark Cash distribution Motor Vehicle Cash available Loan Payment Total e. Prepare the journal entries to close the Partnership Simon Capital Mark Capital Cash