Question

Partners in Game Tech Partnership decided to liquidate the partnership on June 30, 2021, when the balances in the partnership's accounts were as follows: Item Cash Balances before liquidation $32,600 Accounts Accumulated Accounts A. Hunt, K. Lally, D. Portman, Receivable Equipment Depreciation Payable Capital Capital Capital $28,000 $48,600 $16,800 $30,200 $42,100 $18,800 $1,300 The partners share profit and loss 5:3:2 for Hunt, Lally, and Portman, respectively. - Your answer is partially correct. Complete the schedule assuming the noncash assets were sold for $59,800, liabilities are paid, and the cash is distributed appropriately. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses eg. (45).) Accounts Receivable Accumulated Depreciation Cash Item Balances before liquidation $ Equipment 48600 32600 28000 $ 16800 Sale of noncash assets 59800 -28000 -48600 -16800 92400 Payment of liabilities -30200 62200 Allocation of cash -62200

Answer 1

Steps for Dissolution 1. Teans for assets to Realization Alu except Crash or Bank 2. Realize non cash assets in Realization the 3. Pay babilities through Realization Ale 4. Distribute Profit / Loss on Realization in Profit Sharing Ratio (PSR) to Partners of firm. 5. Settle cash balance Balance Copital Ale of partners through Cash / Bank Ale and Cash / Bork Ale should tally with equal amount. 3. ne In the Given Question, we pass following Journal entries for dissolution when assets are sold for $59,800 Date I Particulars o Debits) Credit (3 76,600 30 106/21 a 28000 48600 Realization Al Dr. To Accounts Receivable - To Equipment Being entry passed to realize the assets) Accumulated Depreciation Dr. - To. Realization de being entry passed to transfer oce- depreciation) 30 106 121 16,800 16,800 Canon Talca o

www.navnet.com PAGE NO. DATE: Particulars Delit (8) Credird) - 30,200 30,200 Two 121 Accounts Payable Dr. I To Realization Ale I (Being entry passed to realize accounts payable) Dr 59800 106/21 59.900 Cash All To Realization the [being assets sold and cash realized] 30 200 42,100 1,300 30/06/21 Realization the li Dr 30,200 To cash Al being accounts payable paid). 4/06/21 Hunt Capital Ale & Dr. tally Capital Alo Dr ro 18,800 Portman Capital Al (Being cash & distributed among partners and o firm dissolved). CS 62, 200 To Cash Al

Case II Journal of Crame Tech Partnership Assets sold for $45,000 and deficiencies bought by deficient partner Date 30/06/21 30/06/21 Particulars a hoton Debit ($) Credits ①, 2 and ③ entries remain same as previous one. Cash the - Dr. 45.000 0 To Realization thu 45,000 (bring cash realized from assets) at Realization the Dr. 30,200 To Cash Alo 30,200 Being accounts payable paid site hals Realization the Da Hunt's Capital Al Dr. 7400 Lally's Capital tl Dr. 4440 Portman's Capital Ale Dr. 2960 I To Realization the 14,800 (Being loss distributed to partners in PSR 3.1.50 3:2) 30/06/21 1660 1660 30/06/21 Cash Al Ch Dr. To Portman's Capital the (Being deficiency bought by deficient partner hoss - Balance Cs, Scanne 2940 - 1300 = 1660) CamScanneratulations! Taka pride. You are using a hlavneet ecubuddy product o

www.navneet.com --- PAGE NO. DATE: solobel Hunt's Capital the Dr. 34700 hally's Capital the Dr. (4360 To 'Cash Al (being cash distributed to partners and accounts settled 47,400 Date Case II- Cash Realised -$30,000 Deficiency alsorbed by other partners Journal of brame Tech Partners Wp Particulars Delir (3) Credit hos) 0 ① and ② entries remain same as Case I solo6/21 Cash Alo Dr. 30,000 To Realization the 30,000 (being cash realized 30/06/21 Realization the Dr. 30,200 To Cash sh C Being account payable puid) 30/06/21 Hunt's Capital th 14,900 Dr 8.940 Lally's Capital th Dre 5,960 Portman's Capital de *29,800 To Realization Alc (Being loss on realization. distributed in PSR) Scanne CamScanner 30,200 cs on

Date Particulars Delut (1) Credor (8) 30/06/21 2,913 1747 Hunt's Capital the Dr Lally's Capital Ale Dr. To Portman's Capital Al ( Being deficeny alected by other partners 4,660 Dr 30/06/21 Hunt's Capital Alc Lilly's Capital Ale To Cash Alu (Being cash settled by CS Scann distributing to peerthers) CamSca 24,287 28,113 32,400

Loss on Realization Accounts Receivable = $28,000 -Equipment p = $48,600 Accumulated Repreciation d$ 16,800) Sale amount received ($45,000? - Loss . $14,800 Distributed in PSR Hunt (5) 14,800x5 14,80023 lo (2) Portman 14,800x2 10 10 = 4440 es Scanne 7, 400 = 2960 CamScan

Case II hass on Realization Accounts Receivable Equipment Hecumulated Depreciation Assets Realised 28000 48,600 - 16,800 31,800 - 30,000 __ $ 29,800 Distributed in PSR (5) Hunt's Capital 29.800 x (3) Lally's Capital 29800 x 3 10 = 8940 (2) Portman's Capital" 2980002 10 = 14900 =5960 But it is absorbed by other partners, Portman's Capital Deficiency - 5960 1300 H660 Hunt (5/8) Lolly (318) 466065 4660 x 3 88 CS Scanned with = 2913 = 1747 CamScanner

Table no. 1 - Selling assets at $59800.

(In $)

ITEM	Cash	Accounts Receivable	Equipment	Accumulated Depreciation	Accounts Payable	Hunt's Capital	Lally's Capital	Portman's Capital
Balance before liquidation	32600	28000	48600	16800	30200	42100	18800	1300
Sale during liquidation	59800	-28000	-48600	-16800
	92400
Paying off liabilities	-30200				-30200
	62200
Pay off Partner's Capital Balance	-62200					-42100	-18800	-1300

Table no. 2 - Selling assets at $45000 and deficiencies to be filled in by deficient partner.

(In $)

Table no. 3 - Selling assets at $30000 and deficiencies to be absorbed by other partners.

(In $)