Reference no: EM133031091

Question - Arch, Bibb, and Dao have been in partnership for a number of years. The partners allocate all profits and losses on a 4:4:2 basis, respectively. Recently, the partners have decided to terminate the business and liquidate assets. At the date the partnership ceases operations, the partnership's balance sheet is as follows:

Cash $130,000

Liabilities $50,000

Accounts Receivable 80,000

Arch, Capital (40%) 120,000

Buildings and Equipment 150,000

Bibb, Capital (40%) 130,000

Dao, Capital (20%) 60,000

Total Assets $360,000

Total Liabilities and Capital $360,000

Required - What are the journal entries for the following transactions:

a. Collected $50,000 from the $80,000 accounts receivable. $30,000 is written off as bad debt.

b. Paid $12,000 in liquidation expenses.

c. Paid $50,000 of the partnership's liabilities.

d. Distributed safe payments of cash; the partners anticipate no further liquidation expenses.

e. Sold land, building, and equipment for $90,000.

f. Distributed cash held by the business to the partners.