The CDG Carlos, Dan, and Gail Partnership has decided to liquidate as of Decembe

Question

The CDG Carlos, Dan, and Gail Partnership has decided to liquidate as of December 1, 20X6. A balance sheet on the date follows:

Each partner’s assets (excluding partnership capital interests) and personal liabilities of each partner as of December 1, 20X6, follow:

CDG sold all noncash assets on December 10, 20X6, for $275,000.

Prepare a statement of realization and liquidation for the CDG Partnership on December 10, 20X6.

The CDG Carlos, Dan, and Gail Partnership has decided to liquidate as of December 1, 20X6. A balance sheet on the date follows:

Explanation / Answer

CDG PARTNERSHIP Statement of Realization and Liquidation Lump-sum Liquidation on December 10, 20X6 Capital Balances Cash Noncash Assets Liabilities Carlos Dan Gail Preliquidation balances 33500 543000 302000 137000 67000 70500 Sale of assets and distribution of loss (15:45:40) 275000 -543000 -40200 -120600 -107200 308500 0 302000 96800 -53600 -36700 Cash contributed by Gail to extent of positive net worth 31000 31000 339500 0 302000 96800 -53600 -5700 Distribution of deficit of insolvent partner (15:45) -1425 -4275 5700 339500 0 302000 95375 -57875 0 Contribution by Dan to remedy deficit 57875 57875 397375 0 302000 95375 0 0 Payment to creditors -302000 -302000 95375 0 0 95375 0 0 Payment to partner -95375 -95375 Postliquidation balances 0 0 0 0 0 0 CDG PARTNERSHIP Net Worth of Partners December 10, 20X6 Carlos Dan Gail Personal assets, excluding partnership capital interests 267000 317000 367000 Personal liabilities -238500 -231500 -336000 Personal net worth, excluding partnership capital interests, Dec. 1, 20X6 28500 85500 31000 Contribution to partnership -57875 -31000 Liquidating distribution from partnership 95375 Net worth, Dec. 10, 20X6 123875 27625 0

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