Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows.

KENDRA, COGLEY, AND MEI Balance Sheet May 31
Assets				Liabilities and Equity
Cash	$	86,000		Accounts payable	$	240,000
Inventory		534,000		Kendra, Capital		76,000
				Cogley, Capital		171,000
				Mei, Capital		133,000
Total assets	$	620,000		Total liabilities and equity	$	620,000

Required:

For each of the following scenarios, complete the schedule allocating the gain or loss on the sale of inventory. Prepare journal entries to record the below transactions. (Do not round intermediate calculations. Amounts to be deducted or Losses should be entered with a minus sign. Round your final answers to the nearest whole dollar.)

1. Inventory is sold for $603,600.

2. Inventory is sold for $442,200.

3. Inventory is sold for $306,000 and any partners with capital deficits pay in the amount of their deficits.

(4)	Inventory is sold for $282,000 and the partners have no assets other than those invested in the partnership.

Answer rating: 100% (QA)

1 No a b c d Sale of Inventory Cost of Inventory Gain on Sal... View the full answer