Question

Partners Ute, Aggie, and Cougar share profits and losses in the ratio of 5:3:2, respectively. The partners voted to liquidate the partnership when its assets, liabilities, and capital were as follows: Cash $ 15,000 Liabilities from Outside Creditors $55,000 Loan from Aggie 15,000 Non-cash assets 95,000 Capital, Ute 22,000 Capital, Aggie 13,000 __________ Capital, Cougar 5,000 Total Assets $110,000 Total Liabilities & Equity $110,000 All the noncash assets of $95,000 were sold for $60,000. Cougar was personally insolvent and unable to contribute any cash. Aggie and Ute were both personally solvent and able to eliminate any deficits in their capital accounts through setoff or contribution. All cash was distributed to outside creditors and partners. REQUIRED Prepare a statement of realization and liquidation.

Answer 1

statement of realization and liquidation

	Cash	Non cash assets	Utte	Aggie	Cougar	Outside creditors	Loan from Aggie
Beginning balance	15,000	95,000	22,000	13,000	5,000	55,000	15,000
Sale of non cash asset	60,000	- 95,000	- 17,500	- 10,500	- 7,000	0	0
Deficiency in Cougar's account	0	0	- 1,250	- 750	2,000	0	0
Payment to outside creditors	- 55,000	0	0	0	0	- 55,000	0
Payment of Aggie loan	- 15,000	0	0	0	0	0	- 15,000
Remaining cash divided between Utte and Aggie	- 5,000	0	- 3,250	- 1,750	0	0	0
Ending balance	0	0	0	0	0	0	0

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