liquidation
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- The
statement of Financial Position of Highschool Kids, just before liquidation is as follows:
|
Assets |
|
|
Liabilities & Capital |
|
|
Cash |
50,000 |
|
Liabilities |
70,000 |
|
Other assets |
140,000 |
|
Loan, Young |
20,000 |
|
Loans to Broke |
10,000 |
|
Young, capital (50%) |
30,000 |
|
|
|
|
Dumb, capital (30%) |
50,000 |
|
|
|
|
Broke, capital (20%) |
30,000 |
|
Total |
200,000 |
|
Total |
200,000 |
The partners Young and Dumb are personally insolvent.
If non cash assets are sold for P150,000 and all liabilities are paid and liquidation expense of P5,000 are also paid, how much cash should Young, Dumb and Broke receive?
|
|
Young |
Dumb |
Broke |
|
A. |
32,500 |
51,500 |
31,000 |
|
B. |
55,000 |
53,000 |
22,000 |
|
C. |
52,500 |
51,500 |
21,000 |
|
D. |
47,500 |
48,500 |
19,000 |
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- Partners Ong, Rodriguez, Pamittan and Reyes who share profits andlosses at 30%, 30%, 20% and 20%, respectively, decided to liquidate. Allpartnership assets are to be converted into cash. Before liquidation, thecondensed statement of financial position follows:Cash P100, 000 Liabilities P750, 000Other Assets 1, 800, 000 Rodriguez, Loan 60, 000Reyes, Loan 50, 000Ong, Capital 420, 000Rodriguez, Capital 315, 000Pamittan, Capital 205, 000Reyes, Capital 100, 000Total P1, 900,000P1, 900,000The non-cash assets realized P800, 000, resulting to a loss of P1, 000,000. All the partners are solvent, and can contribute any additional cash tocover any deficiency. In the process of liquidation, deficiencies will occur andwill require additional investment as follows:a. Pamittan at P7, 500b. Reyes at P50, 000c. Reyes and Pamittan for P50, 000 and P7, 500, respectivelyd. NoneThe statement of financial position of the firm AA, BB and CC immediately before liquidation shows the following: Assets 640,000 Liabilities 240,000 AA, Loan 64,000 AA, Capital 168,000 BB, Capital 120,000 CC, Capital 48,000 Total 640,000 AA, BB and CC share profits 5:3:2 respectively. Certain assets are sold for P440,000. Creditors are paid in full, partners are paid P140,000 and cash of P60,000 is withheld for contingencies. How much cash is to be distributed to AA?The partners in Crawford Company decide to liquidate the firm when the balance sheet shows the following. Crawford Company Balance Sheet May 31, 2020Assets Liabilities and Owners' EquityCash $ 27,500 Notes payable $ 13,500Accounts receivable 25,000 Accounts payable 27,000Allowance for doubtful accounts (1,000) Salaries and wages payable 4,000Inventory 34,500 A. Jamison, capital 30,000Equipment 21,000 S. Moyer,…
- The following selected account balances were taken from the balance sheet of Quitting Corp. as of December 31, 2020, immediately before the take over of the trustee: Marketable securities P300,000 Inventories 110,000 Land 150,000 Building 400,000 Additional information: • Marketable securities have present market value of P320,000. These securities have been pledged to secure notes payable of P280,000. • The estimated worth of inventories is P70,000. However, inventories with book value of P50,000 have been pledged to secure notes payable of P60,000. The realizable value of the inventories pledged is estimated to be P40,000. • Land and building are estimated to have a total realizable value of P450,000. This property is pledged to secure the mortgage payable of P250,000. What is the estimated amount available for preferred claims and unsecured creditors out of the assets pledged with fully secured creditors?a. P240,000b. P840,000c. P770,000The following trial balance has been extracted from the books of Abraham as at 31st March 2023 UGX 000 UGX 000 Administrative expense 250 Distribution cost 295 Share capital (all ordinary shares of UGX 1 each 270 Share premium 80 Revaluation reserve 20 Dividend 27 Cash at bank and hand 3 Receivables 233 Interest paid 25 Dividend received 15 Interest received 1 Land and buildings at cost (land 380, building 100) 480 Land and building acc. Dep 30 Plant and machinery 400 Plant and machinery acc. Dep 170 Retained earnings account (at April 2022 235 Purchases 1260 Sales 2165 Inventory at 1 April 2022 140 Trade payables 27 Bank loan 100 Total 3113 3113 Additional Information Inventory at 31st March 2023 was valued at a cost UGX 95000. Include in this…The Distance Plus parnership has the following capital balances at the beginning of the current year. Tiger (40% of profits and losses) $65,000 Phil (20%) $35,000 Ernie (40%) $50,000 Each of the following questions should be viewed independently. a. If Sergio invests $70,000 in cash in the business for a 30% interest, what journal entry is recorded. Assume the bonus method is used. b. If Sergio invests $60,000 in cash in the business for a 30% interest, what journal entry is recorded. Assume the bonus method is used. c. If Sergio invests $72,000 in cash in the business for a 30% interest, what journal entry is recorded. Assume the goodwill method is used.
- Please answer it in a good accounting form. Thank you! The following selected account balances were taken from the balance sheet of Quitting Corp. as of December 31, 2020, immediately before the take over of the trustee:Marketable securities P300,000Inventories 110,000Land 150,000Building 400,000Additional information:• Marketable securities have present market value of P320,000. These securities have been pledged to secure notes payable of P280,000.• The estimated worth of inventories is P70,000. However, inventories with book value of P50,000 have been pledged to secure notes payable of P60,000. The realizable value of the inventories pledged is estimated to be P40,000.• Land and building are estimated to have a total realizable value of P450,000. This property is pledged to secure the mortgage payable of P250,000.What is the estimated amount available for preferred claims and unsecured creditors out of the EXCESS assets pledged with fully…The following selected account balances were taken from the balance sheet of Quitting Corp. as of December 31, 2030, immediately before the take over of the trustee: Trading Securities P 300,000 Inventories 110,000 Land 150,000 Building 400,000 Additional information: • Trading Securities have a present market value of P320,000. These securities have been pledged to secure notes payable of P280,000. • The estimated worth of inventories is P70,000. However, inventories with a book value of P50,000 have been pledged to secure notes payable of P60,000. The realizable value of the inventories pledged is estimated to be P40,000. • Land and building are estimated to have a total realizable value of P450,000. This property is pledged to secure the mortgage payable of P250,000. 18. What is the estimated amount available for preferred claims and unsecured creditors out of assets pledged with fully secured creditors? A. 840,000 B. 770,000 C. 240,000 D. 810,000Veltri Incorporated has the following assets and liabilities (assets are stated at net realizable value): Assets pledged with secured creditors $ 80,000 Assets pledged with partially secured creditors 70,000 Other assets 180,000 Secured liabilities 40,000 Partially secured liabilities 95,000 Liabilities with priority 55,000 Unsecured liabilities 225,000 In a liquidation, how much money would be paid on the partially secured liabilities?
- The Modesto Company is facing possible liquidation.Using the following information, prepare a statement offinancial affairs in good form.Here’s the company’s most recent balance sheet: Assets Liabilities and equities Cash $12,000 Accounts payable $170,000Accounts Receivable 60,000 Notes payable 90,000Inventory 120,000 Mortgage payable 80,000Investments 45,000Equipment 105,000 Common stock 75,000Land 82,000 Retained earnings 9,000Total assets $424,000 Total Liab. and Eq’s $424,000 The mortgage payable is fully secured by the land. The land can be soldimmediately for $103,000The equipment partially secures the notes payable. The equipment is not ingood shape and at auction will bring only $30,000The market has declined so the investments have lost 40% of their value.It is estimated that 30% of the accounts receivable will have to be written off.The inventory is outdated and will bring only 50% of its book value atauction.Additional income taxes will be $26,000Administrative expenses for…. In June 2022, Wild Company had excess cash that would not be needed until March 1, 2022. Management decided to invest the money in a short-term investment in FVTPL financial assets. Wild owned no investment financial assets before June 2022. The following transactions relate to these investments: June 20 Purchase 10,000 shares of West Corporation stock. The price paid was P104,500. September 2 Received a cash dividend of P1.20 per share on West stock. October 5 Sold 4,000 shares of West stock at P10.00 per share. Paid a selling commission of P400. December 31 The market price of West stock was P11.00. Required: Compute the realized gain or loss on October 5, 2022. Compute the amount of unrealized gain or loss that will be reported to income statement for 2022. Assume that the fair value of the investment on December 31, 2023 is P14/share. Compute the amount of unrealized gain or loss that will be reported to income statement for 2023.In May 2020, Falcon Corporation sold to Eagle Company 5 computers which Eagle paid a total of $5,000. Eagle paid $1,000 cash and promised to pay the other $4,000 in June 2021. What is the impact to the accounting equation on this transaction? Assets increased $5,000 and Stockholders' Equity increased $5,000 Assets increased $1,000, Liabilities Increased $4,000 and Stockholders' Equity decreased $3,000 Assets increased $1,000 and Stockholders' Equity increased $1,000 Assets increased $4,000, Liabilities increased $4,000
