Gain or loss on realization to the partners

Reference no: EM131004006

The Freema Company at December 31 has cash $20,000, noncash assets $100,000, liabilities $55,000, and the following capital balances: Dalek $45,000 and Briggs $20,000. The firm is liquidated, and $110,000 in cash is received for the noncash assets. Dalek and Briggs income ratios are 60% and 40%, respectively.

Instructions

Prepare the entries to record:

(a) The sale of noncash assets.

(b) The allocation of the gain or loss on realization to the partners.

(d) Distribution of cash to the partners.

Reference no: EM131004006

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