P12-36b 102,000 Ho Capta Partners Equity kung Caoital ing Capit Toral Partness E

Question

P12-36b

102,000 Ho Capta Partners Equity kung Caoital ing Capit Toral Partness Equty 8 030 22000 5226,000 oal Laites and Parten Euity$ 226000 Requirements Roond Ho's withdrawal from the parnership under the following independens plans L. lh a personal transaction, Ho sells her equity to Wong, who pays Ho $120,000 for he interest. Kung and Liang agree to accept Wong as a partner. 2. The parnership pays Ho cash of $20,000 and gives ber a note payable for she emainder of her book equity in settlement of her 5 The gartnership pays Ho $55.000 for het book equity . The partnenhip pays Ho $8,000 for her book equiry hoxia Acounting for the liquidation of s parterahip partnership intenest The f Exan, Karuo, & Cole bas experienced operating losses for shree s n at rheKazua, 70%; and Cole, 20-are liquidating the busines. They skynu bsnict sheet an December 31,2016 eS The parmers-who have shared profies and losses in the ratio of dthc efes f iqaidarion. dne the effects of liquidation. They peesent ETAN, KAZUG,& COLE 20,000 Partnest Equity

Explanation / Answer

Ist Case

1. Cash A/c ...............................Dr 165000

............To Assets A/c......................................120000

............To Profit on Sale of Asset A/c.............45000

2. Profit On Sale of Assets A/c.......Dr 45000

...........To Etan Capital A/c(45000*10%).................4500

...........To Kazuo Capital A/c(45000*70%).............31500

...........To Cole Capital A/c (45000*20%).................9000

3. Accounts payable A/c..............Dr 56000

...................To Cash A/c.................... 56000

4. Etan Capital A/c....................Dr 13600

Kazuo Capital A/c..................Dr 95200

Cole Capital A/c......................Dr 27200

....................To Cash A/c...............................136000

IInd case

1. Cash A/c................................Dr 80000

Loss on Sale of asset A/c..........Dr 40000

.............To Non cash Asset A/c......................120000

2. Etan Capital A/c.................Dr 4000

Kazuo Capital A/c..................Dr 28000

Cole Capital A/c.....................Dr 8000

..............To Loss on Sale of asset A/c.............40000

3. Accounts Payable A/c............Dr 56000

..............To Cash A/c........................................56000

4. Etan Capital A/c....................Dr 5100

Kazuo Capital A/c..................Dr 35700

Cole Capital A/c......................Dr 10200

....................To Cash A/c...............................51000

Thank You

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