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    Assignment Lump Sum Liquidation

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    patricia marie olmedo
    The document contains four problems involving the liquidation of partnerships. Problem 1 provides balance sheet information for the B and C Partnership and instructions to prepare a liquidation statement. Problem 2 provides similar information for the Lady, Candice and Cheryl Partnership along with instructions for multiple liquidation statements. Problem 3 provides balance sheet information and additional details for the CDG Partnership and instructions to prepare liquidation statements and journal entries. Problem 4 provides balance sheet information for the MYL Partnership and instructions to determine partner distributions under various liquidation scenarios.

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    Assignment Lump Sum Liquidation

    Uploaded by

    patricia marie olmedo
    16 views2 pages
    The document contains four problems involving the liquidation of partnerships. Problem 1 provides balance sheet information for the B and C Partnership and instructions to prepare a liquidation statement. Problem 2 provides similar information for the Lady, Candice and Cheryl Partnership along with instructions for multiple liquidation statements. Problem 3 provides balance sheet information and additional details for the CDG Partnership and instructions to prepare liquidation statements and journal entries. Problem 4 provides balance sheet information for the MYL Partnership and instructions to determine partner distributions under various liquidation scenarios.

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    Reviewer problems lumpsum liquidation

    Original Title

    Assignment-Lump-Sum-Liquidation

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    The document contains four problems involving the liquidation of partnerships. Problem 1 provides balance sheet information for the B and C Partnership and instructions to prepare a liquidation statement. Problem 2 provides similar information for the Lady, Candice and Cheryl Partnership along with instructions for multiple liquidation statements. Problem 3 provides balance sheet information and additional details for the CDG Partnership and instructions to prepare liquidation statements and journal entries. Problem 4 provides balance sheet information for the MYL Partnership and instructions to determine partner distributions under various liquidation scenarios.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    16 views2 pages

    Assignment Lump Sum Liquidation

    Uploaded by

    patricia marie olmedo
    The document contains four problems involving the liquidation of partnerships. Problem 1 provides balance sheet information for the B and C Partnership and instructions to prepare a liquidation statement. Problem 2 provides similar information for the Lady, Candice and Cheryl Partnership along with instructions for multiple liquidation statements. Problem 3 provides balance sheet information and additional details for the CDG Partnership and instructions to prepare liquidation statements and journal entries. Problem 4 provides balance sheet information for the MYL Partnership and instructions to determine partner distributions under various liquidation scenarios.

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    © All Rights Reserved
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    of 2

    Problem 1

    On June l, 2001, Brian and Carmina, partners of B and C Partnership, decided to liquidate their
    partnership. At the time of liquidation, the balance sheet accounts consisted of cash - P25,000;
    noncash assets - P600,000; liabilities P125,000; Brian, capital - P225,000; Carmina, capital -
    P275,000. Brian and Carmina share profits and losses in the ratio of 3:2, respectively. Brian is
    personally insolvent. Noncash assets were sold for P350,000.

    Instructions: Prepare a statement of partnership liquidation.

    Problem 2
    The partners of Lady, Candice and Cheryl Partnership have agreed to liquidate their partnership
    as of December 31, 2000. The partnership has cash of P80,000, noncash assets of P810,000, and
    liabilities of P270,000. The capital accounts of the partners are: Lady, P60,000; Candice,
    P290,000; Cheryl, P270,000. The partners share profits and losses in the ratio 5:3:2 respectively.
    The partnership was able to sell all the noncash assets for 634,000 and paid P24,000 of
    liquidation expenses.

    Instructions;
    1. Prepare a statement of liquidation assuming all partners are solvent.
    2. Prepare a statement of liquidation assuming the liabilities of P270,000 include a P70,000 note
    payable to Lady. All partners are solvent.
    3. Prepare a statement of liquidation assuming the noncash assets of P 810,000 include a note
    receivable from Candice in the amount of PI 10,000. The liabilities include a P70,000 note
    payable to Lady.

    Problem 3
    The Cling, Ding and Ging (CDG) Partnership has decided to liquidate as of December l, 2001.
    The balance sheet as of this date follows:

    CDG Partnership
    Balance Sheet
    December 31, 2001

    Assets Liabilities & capital


    Cash P 25,000 Accounts payable P240,000
    Accounts receivable (net) 75,000 Loan payable to Ding 30,000
    Inventory 100,000 Cling, capital 120,000
    Plant and equipment (net) 300,000 Ding, capital 50,000
    Ging, capital 60,000
    Additional information:
    1. The Personal assets (excluding partnership capital and loan interests) and Personal liabilities
    as of December l, 2001 are as follows:
    Cling Ding Ging
    Personal Assets 250,000 P300,000 P350,000
    Personal Liabilities (230,000) (240,000) (325,000)
    Personal net worth 20,000 60,000 25,000
    2. Cling, Ding, and Ging share profits and losses in the ratio of 20:40:40, respectively.
    3. According to the partnership agreement, interest does not accrue on partners' loan balances
    during the liquidation process.
    3. All of the noncash assets were sold on December 10, 2001 for P260,000.
    Instructions:
    l. Prepare a statement of liquidation.
    2. Prepare the journal entries to record the liquidation of the partnership.
    3. Prepare a schedule showing how the partners' personal assets are to be distributed.

    Problem 4
    The partners of the MYL Partnership have decided to liquidate their partnership. The partnership
    balance sheet just prior to liquidation is presented below:
    Assets Liabilities & Capital
    Cash P 63,000 Liabilities P308,500
    Other assets 455,500 M, capital 90,000
    Y, capital 90,000
    L, capital 30,000

    The other assets include a note receivable from Partner M in the amount of P75,000. The
    liabilities include a note payable to Partner Y of P40,000 and a note payable to Partner L of
    P60,000. The partners share profits and losses in the ratio of 2:2:1, respectively.

    Instructions:
    l. Determine the amount of cash each partner will receive for each of the following independent
    assumptions:
    a. The other assets are sold for P300,000 and all the partners are solvent.
    b. The other assets are sold for P270,000 and Partner M is insolvent.
    c. The other assets are sold for P270,000 and P24,875 of liquidation expenses are paid. Partner M
    is insolvent.
    2. If the partners receive an offer of P 140,000 for the business, exclusive of the cash, would they
    be better off accepting the offer or liquidating under the condition in la above?

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