The Statement of financial position as at 31 March 2012, of Sarah and Terry, sharing profits equally,
Question:
The Statement of financial position as at 31 March 2012, of Sarah and Terry, sharing profits equally, reported their position as. Current assets included £30,000 cash. Expenses of dissolution amounted to £4,000. Answer the questions below treating each as an independent scenario:
(a) On a piecemeal dissolution sale of the assets realised £240,000 and liabilities were discharged subject to 10% discount. Identify the gain or loss on dissolution of the partnership
(b) Sarah’s capital and current accounts totalled £140,000. She took over from the partnership a vehicle acquired for £30,000 and depreciated by £8,000, while the remaining assets were sold for £280,000 and liabilities discharged subject to 20% discount. How much will Sarah receive on closure of the partnership?
Step by Step Answer:
Financial Accounting An Introduction
ISBN: 9780273737650
2nd Edition
Authors: Mr Barry Elliott, Mr Augustine Benedict