Record the entries in the liquidation account

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Question - Bugs Ltd went into voluntary liquidation on 30 June 2020. Its summarised statement of financial position at that date is as follows:

Bugs Ltd Statement of Financial Position As at 30 June 2020

Equity

 

Current assets

 

 

Share capital

53 000

Cash

10 000

 

 

 

Inventory

12 000

22 000

 

 

Non-current assets

 

 

 

 

Land

 

40 000

 

 

Total assets

 

62 000

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

Payables

 

9 000

 

 

 

 

 

Total equity

53 000

Net assets

 

53 000

All assets realised amounted to $55 000. Payables allowed a $500 discount. Costs of liquidation were $3 000.

Required -

1. Complete the journal entries to liquidation.

2. Record the entries in the Liquidation account, the Liquidators receipts & payments, and the Shareholders distribution account.

Reference no: EM132566200

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