Immediately prior to the process of liquidation, partners Micco, Niccum, and Orw

Question

Immediately prior to the process of liquidation, partners Micco, Niccum, and Orwell have capital balances of $70,000, $20,000, and$30,000 respectively. There is a cash balance of $10,000,non-cash assets total $160,000, and liabilities total $50,000. The partners share net income and losses in the ratio of 2:2:1.

Journalize the entries to record the liquidation outlined below,using Assets as the account title for the non-cash assets and Liabilities as the account title for all creditors' claims.
-1
Sold the nonc ash assets for $80,000 in cash.
-2

Distributed the cash to the partners.

Explanation / Answer

1

2

M Capital               38,000.00O

Capital                    14,000.00  

Cash                                           52,000.00

  Cash   80,000.00         Loss on Realization   80,000.00               Assets       160,000.00

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