Statement of Partnership Liquidation

On August 3, the firm of Chapelle, Rock, and Pryor decided to liquidate its partnership. The partners have capital balances of $54,000, $76,000, and $12,000, respectively. The cash balance is $22,000, the book values of noncash assets total $159,000, and liabilities total $39,000. The partners share income and losses in the ratio of 2:2:1.

Required:

1. Prepare a statement of partnership liquidation, covering the period August 329, for each of the following independent assumptions:

a. All of the noncash assets are sold for $215,000 in cash, the creditors are paid, and the remaining cash is distributed to the partners. Enter any subtractions (balance deficiencies, payments, cash distributions, divisions of loss, sale of assets) as negative numbers using a minus sign. If there is no amount or an amount is zero, enter "0".

Chapelle, Rock, and Pryor Statement of Partnership Liquidation For Period August 329
	Cash	+	Noncash Assets	=	Liabilities	+	Capital Chapelle (2/5)		+	Capital Rock (2/5)		+	Capital Pryor (1/5)
Balances before realization	$fill in the blank 1		$fill in the blank 2		$fill in the blank 3		$fill in the blank 4			$fill in the blank 5			$fill in the blank 6
Sale of assets and division of gain	fill in the blank 7		fill in the blank 8		fill in the blank 9		fill in the blank 10			fill in the blank 11			fill in the blank 12
Balances after realization	$fill in the blank 13		$fill in the blank 14		$fill in the blank 15		$fill in the blank 16			$fill in the blank 17			$fill in the blank 18
Payment of liabilities	fill in the blank 19		fill in the blank 20		fill in the blank 21		fill in the blank 22			fill in the blank 23			fill in the blank 24
Balances after payment of liabilities	$fill in the blank 25		$fill in the blank 26		$fill in the blank 27		$fill in the blank 28			$fill in the blank 29			$fill in the blank 30
Cash distributed to partners	fill in the blank 31		fill in the blank 32		fill in the blank 33		fill in the blank 34			fill in the blank 35			fill in the blank 36
Final balances	$fill in the blank 37		$fill in the blank 38		$fill in the blank 39		$fill in the blank 40			$fill in the blank 41			$fill in the blank 42

b. All of the noncash assets are sold for $70,000 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. Enter any subtractions (balance deficiencies, payments, cash distributions, divisions of loss, sale of assets) as negative numbers using a minus sign. If there is no amount or an amount is zero, enter "0".

Chapelle, Rock, and Pryor Statement of Partnership Liquidation For Period August 329
	Cash	+	Noncash Assets	=	Liabilities	+	Capital Chapelle (2/5)		+	Capital Rock (2/5)		+	Capital Pryor (1/5)
Balances before realization	$fill in the blank 43		$fill in the blank 44		$fill in the blank 45		$fill in the blank 46			$fill in the blank 47			$fill in the blank 48
Sale of assets and division of loss	fill in the blank 49		fill in the blank 50		fill in the blank 51		fill in the blank 52			fill in the blank 53			fill in the blank 54
Balances after realization	$fill in the blank 55		$fill in the blank 56		$fill in the blank 57		$fill in the blank 58			$fill in the blank 59			$fill in the blank 60
Payment of liabilities	fill in the blank 61		fill in the blank 62		fill in the blank 63		fill in the blank 64			fill in the blank 65			fill in the blank 66
Balances after payment of liabilities	$fill in the blank 67		$fill in the blank 68		$fill in the blank 69		$fill in the blank 70			$fill in the blank 71			$fill in the blank 72
Receipt of deficiency	fill in the blank 73		fill in the blank 74		fill in the blank 75		fill in the blank 76			fill in the blank 77			fill in the blank 78
Balances	$fill in the blank 79		$fill in the blank 80		$fill in the blank 81		$fill in the blank 82			$fill in the blank 83			$fill in the blank 84
Cash distributed to partners	fill in the blank 85		fill in the blank 86		fill in the blank 87		fill in the blank 88			fill in the blank 89			fill in the blank 90
Final balances	$fill in the blank 91		$fill in the blank 92		$fill in the blank 93		$fill in the blank 94			$fill in the blank 95			$fill in the blank 96

2. Assume the partner with the capital deficiency in part (b) declares bankruptcy and is unable to pay the deficiency.

a. Journalize the entry to allocate the partner's deficiency. For a compound transaction, if an amount box does not require an entry, leave it blank.

ACCOUNT	DEBIT	CREDIT
	fill in the blank 98	fill in the blank 99
	fill in the blank 101	fill in the blank 102
	fill in the blank 104	fill in the blank 105

b. Journalize the entry to distribute the remaining cash. For a compound transaction, if an amount box does not require an entry, leave it blank.

ACCOUNT	DEBIT	CREDIT
	fill in the blank 107	fill in the blank 108
	fill in the blank 110	fill in the blank 111
	fill in the blank 113	fill in the blank 114