| 200 Chapter 4 MSO] A MOOS The statement of financial position of the partnership of Rivas and Brionesas of December 31, 2016 is as follows: Rivas and Briones Statement of Financial Position December 31,2016 Assets Liabilities and Partner's Equity Cash P 20,000 Liabilities 132,000 Other Assets 200,000 Rivas loan 18,000 Briones, loan” 20,000 Rivas, capital 40,000 Briones, capital 10,000 Total Assets Total Liabilities and Partners’ Equity _P220,000 * The other assets were realized for P134,000, and all cash is disbursed. Division of profits and losses are: Rivas Briones Case 1 90% 10% Case 2 0% 30% Case 3 50% 50% Required: Prepare the partnership liquidation statement and the journal entries to record the liquidation for each case.201 pore Blando and Castro decided to liquidate their partnershi ‘ lip busi i 4 ers had been sharing profits and losses on 3 60:40 tition ae of financial position prepared on the day liquidation began was as. follows: Blando and Castro Statement! of Financial Position ‘April 1, 2016 Assets Liabilities and Equity Cash P 18,000 ‘Accounts Payable P 42,000 Receivables 75,000 Blando, loan 24,000 Inventory 90,000 Blando, capital 102,000 Other Assets (net) 84,000 Castro, capital 90,000 9,000 Castro, drawing Total Liabilities & Equity 267,000 == Total Assets 267,000 = During April, one-half of the receivables was collected; 40,000 of inventory Was: sold ther assets were sold for P40,000. atan average of 75% of book value; 01 Required: Prepare a partnership liquidation statement. and share profits ina 5:3:2 Amp, Volt, and Watt are partners inthe Electric Company c na 5 ratio, The statemento! ep i ie sree oS the business, is as follows: Assets “Liabilities and Equity iabiliti P 30,000 Cash * P 20,000 Liabilities .¢ Amp, Loan 15,000 Volt, Loan ; om Noncash Assets 135,000 ‘Amp, Capital K Volt, Capital 36,000 Watt, Capital 14,000 — Total Liabilities & Equity 170,000 = 170,000202 : Chapter 4 Problem 4-3: Continued The noncash assets are sold for P95,000. Rather than require payments, all partners agree to offset the receivable from Amp against his capital credit. tee realization and liquidation. a. astatement of partnership ion ation. — 7 b. i the required journal entries to account for the liquidation of the Electric Company. kOe i i i i i :4:1. The partnership Aida, Bina and Celia are partners with a profit and loss ratio of 5 i was liquidated, and prior to the liquidation process, the partnership statement of financial Position was as follows: ABC Partnership Statement of Financial Position January 1, 2016 a re ee Assets Cash P 80,000 Other assets _720,000 Total assets P800,000 Equity Aida-capital P320,000 Bina-capital 320,000 Celia-capital 160,000 Total equity P800,000 ‘Afr the partnership was liquidated and the cash was distributed, Bina received P128,000 incash in full settlement of his interest, Required: a. Compute the amount of the Tealization loss on the sale of the . b. Prepare a statement of Partnership liquidation, gu hatePartners JJ, KK and LL have decided to liquidate the ‘of financial position: i he ftonn their partnerships. The partnerships AGES Bas aa Cash P 5 Other assets socaun Total assets 550,000 Liabilities and Owners’ Equity © Liabilities P 60,000 JJ, capital 180,000 KK, capital 240,000 LL, capital Total liabilities and owners’ equity ‘The partners share profits and losses in a 4:4:2 ratio and all partners are personally solvent. LL received P98,000 in cash in full settlement for her share of the partnership. Required: a. What was the selling price for the other assets? b. Prepare a statement of partnership liquidation. ‘The following information is provided in connection with the liquidation ofa partnership: Profit Partnership and Capital Loss Balance Personal Personal Partner Ratio Cr. (Dr) Assets Liabilities BB 30% P 160,000 200,000 P40,000 cc 10 80,000 120,000 100,000 DD 20 (120,000) 160,000 100,000 EE 40 (180,000) 80,000 120,000 Capital Deficiency P (60,000)204 Chapter ¢ Problem 4-6: Continued Required: L a. ‘Indicate the maximum amount that partnership creditors can enforce against each partner’s personal assets in seeking payment of the creditor’s claims, b. Assume that BB advances P60,000 to pay the partnership creditors. Prepare a at of partnership liquidation. (Hint: DD must deposit P60,000 of personal assets. RDC Sayson and Zobel have been partners in a successful business for a number of years. They decide to admit two of their employees in their partnership. After the inclysion of the two, the profit sharing is Sayson, 45%; Zobel, 30%; Ayala, 15% and Pefia, 10%. Itis agreed that Ayala and Pefia are not required to make any capital contribution but it is provided that in the event of the sale of the assets of the business within five years, Sayson and Zobel alone will share in the proceeds of any goodwill. ‘ Three years after the admission of the employees into the partnership, an offer of P 185,000 is received for the non-cash assets of the partnership. Business currently is depressed, so the partners decide to accept the offer. After closing the books, the ledger shows the following account balances: Debits Cash P 15,000 Accounts receivable Notes receivable Inventory Land Delivery truck - net Building - net Ayala, capital Credits Accounts payable Notes payable Pefia, loan Sayson, capital Zobel, capital Pefia, capitalporterships Liquidation 205 problem 4-7: Continued The ers pay all liabilities and distribute the balance of the cash to the partners. ‘Assume that a deficient partner will not be able to cover his debit balance. Required: Prepare a statement of partnership liquidation. Following is the statement of financial position for Art, Bea and Cid Partnership on Jt 4,2016, immediately before its Tiquidation: : pew Art, Bea and Cid Partnership Statement of Financial Position July 4, 2016 eee Assets S Cash P 6,000 Other assets 94,000 Total assets Liabilities and Partners’ Equity Liabilities Loan Payable to Bea Art, capital Bea, capital Cid, capital Total liabilities and partners’ equity The. ers shared net income and losses as follows: Art, 40%; Bea, 40%; and Cid, 209% On uly 4, 2016, the other assets realized 30,700, and P20,500 had to be paid to liquidate the liabilities because ofan unrecorded trade account payable of P500. Art and Bea were solvent, but Cid’s personal liabilities ‘exceeded personal assets by P5,000. Required: : i ; a. Prepare a statement of liquidation for Art, Bea and Cid Partnership on July 4, 2016, Combine Bea’s loan and capital account balances. Po b. Prepare journal entries for Art, Bea and ‘Cid Partnership to record the liquidation on : c Howeughe as ‘would other assets have to realize on liquidation in order for Cid to pecive enough cash from the partnership to pay personal eeditorsin full? Assume that P20,500 is required to liquidate the ip liabilities.Chapter 4 PO sea eer tae The KGB Partnership decided to liquidate the statement of financial position of the partnership. KGB Partnership Statement of Financial Position June 30, 2016 Assets Cash ‘Accounts receivable net (net) Inventories Property, Plant, and Equipment (net) Total Assets Liabilities and Partner’s Equity Accounts payable G, Loan Total Liabilities Partner’s Capital: K, Capital G, Capital B, Capital Total Capital Total Liabilities and Equity Additional Information 1. The personal assets (excluding partnership capital and loan interests) and personal liabilities of each partner as of June 3 partnership as of June 30,2016. The ‘as of this date is as follows: P» 50,000 150,000 200,000 | 600,000 P1,000,000 P 480,000 60,000 P 540,000 240,000 100,000 120,000 a 460,000 P1,000,000 0, 2016, follow: K G B Personal assets 500,000) Personal liabilities ( 460,000) «548 000) (50000) 2. K,G and B share profits and losses in the ratio of 20:40: ivel 3. All the noncash assets were sold on J uly 4, 2016, for ie : 4. No interest accrues on partner’s loan balances, , ons Required: a. Prepare a statement of realization and liquidation for the KGB Partnership 00 June” 30, 2016. b. Prepare aschedule showing h . ee, show the partners’ personal assets are to be distribu? i according to the Partnership Law, j