The following condensed balance sheet is for the partnership of Hardwick, Saunde

Question

The following condensed balance sheet is for the partnership of Hardwick, Saunders, and Ferris, who share profits and losses in the ratio of 4:3:3, respectively: Cash Other assets Hardwick, loan $ 85,000 Accounts payable Ferris, loan Hardwick, capital Saunders, capital Ferris, capital $ 156,000 50,000 300,000 220,000 210,000 $ 936,000 800,000 51,000 Total assets $ 936,000 Total liabilities and capital The partners decide to liquidate the partnership. Forty percent of the other assets are sold for $210,000. Prepare a proposed schedule of liquidation at this point in time HARDWICK, SAUNDERS, AND FERRIS Proposed Schedule of Liquidation Other Assets Hardwick Loan andSaunders, Ferris, Loan & Capital Cash Payable Capital Capital Beginning balances Sold assets Assumed loss on remaining assets Paid liabilities Safe balances

Explanation / Answer

Cash Other Asset Account Payable Hardwick Loan and Capital Account Saunders Capital Ferris Loan and Capital Beginning Balance 85000 800000 156000 249000 220000 260000 Sold assets 210000 -320000 -44000 -33000 -33000 Assumed: loss on remaining assets -480000 -192000 -144000 -144000 Paid liabilities -156000 -156000 Safe balances 139000 0 0 13000 43000 83000

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