Chapter 12, Problem 13QS

1.

To determine

Concept Introduction:

Liquidation of Partnership: The process in which all the assets are sold for a partnership business and the collection hence made is distributed amongst partners is referred as liquidation of partnership. In an accounting process, the liquidation of partnership begins with selling of non-cash assets and realizing the amount hence made. The profit or loss made on sale is distributed amongst partners in the income sharing ratio. If there is profit, liabilities are disbursed with that amount. Balance amount is then distributed amongst partners in mutually decided ratio.

The capital balance of each partner after the liquidation and assets and payment of creditors

2.

To determine

Concept Introduction:

Liquidation of Partnership: The process in which all the assets are sold for a partnership business and the collection hence made is distributed amongst partners is referred as liquidation of partnership. In an accounting process, the liquidation of partnership begins with selling of non-cash assets and realizing the amount hence made. The profit or loss made on sale is distributed amongst partners in the income sharing ratio. If there is profit, liabilities are disbursed with that amount. Balance amount is then distributed amongst partners in mutually decided ratio.

To prepare: The journal entries on May 31 to record the (a) cash received to cover the deficit and (b) final disbursement of cash to partners.

3.

To determine

Concept Introduction:

Liquidation of Partnership: The process in which all the assets are sold for a partnership business and the collection hence made is distributed amongst partners is referred as liquidation of partnership. In an accounting process, the liquidation of partnership begins with selling of non-cash assets and realizing the amount hence made. The profit or loss made on sale is distributed amongst partners in the income sharing ratio. If there is profit, liabilities are disbursed with that amount. Balance amount is then distributed amongst partners in mutually decided ratio.

To prepare: The journal entries on May 31 to record the (a) transfer of deficit from the deficient partner to other partners and (b) final disbursement of cash to partners.