Reference no: EM132891065

Godwin, Angelica, and Christine, partners sharing profits and losses based on 4:4:2 decided to liquidate on December 31, 2016. All assets of the partnership were liquidated. The condensed statement of financial position just prior to liquidation follows:

??Assets?????                                        Liabilities and Capital
?Cash??PhP100,000                    Liabilities??PhP140,000??
?Other Assets 400,000                ???Godwin, Loan?? 10,000
???????Godwin, Capital? ? 45,000
???????Angelica, Capital ? ? 105,000
???????Christine, Capital? ? 200,000?

???PhP500,000                                        ??????PhP500,000

Other assets were sold for PhP247,500. Parties agreed to fully terminate the partnership's business thus, necessitating distribution of cash to partners and in case of capital deficiency, contribution of additional cash. The three partners were all solvent and could answer any capital deficiency.

Required:

Problem a. Prepare a statement of liquidation for the period December 31, 2016.

Problem b. Prepare the necessary journal entries as at December 31, 2016.