Reference no: EM132772147

Question - Jan 2, Year 1 Albert, Bill, Charlie formed a partnership by signing an agreement that stated that all profits would be shared 2:3:5 ratio and by making the following investments:

Albert Bill Charlie

Cash 12,000 8,000 14,000

Accounts Receivable (net) 20,000 14,500 60,000

Office Furniture (net) 0 0 15,000

Vehicles (net) 21,000 38,500 0

Dec 31, Year 1 The partnership reported net income of $53,500 for the year.

June 7, Year 2 Albert and Charlie agreed that Bill could sell their share of the partnership to Doug for $75,000. The new partners agreed to keep the same profit-sharing arrangement (2:3:5 for Albert, Doug, Charlie)

Dec 31, Year 2 The partnership reported a loss of $67,000 for the year.

Jan 3, Year 3 The partnership agreed to liquidate the partnership. On this date the balance sheet showed the following items with all accounts having their normal balances:

Cash 17,500

Accounts Receivable 316,000

Allowance for uncollectible accounts 22,500

Office Furniture 74,500

Vehicles 240,000

Accumulated amortization (total) 49,500

Accounts Payable 386,500

The assets were sold for the following amounts:

Accounts receivable 200,000

Office Furniture 75,000

Vehicles 100,000

Albert and Doug both have personal assets, but Charlie does not.

Required - Journalize all the transactions for the partnership.