The statement of financial position for Sara and Tracey at 30 November 2014 was as follows.

Sara and Tracey share profits and losses equally. They have agreed to dissolve the partnership as Sara has decided to move abroad. Tracey will buy most of the assets as she wishes to continue to trade but as a sole trader. The non-current assets are taken over by Tracey at a value of $210,000. She also takes over the inventory at a value of $23,000. The trade receivables pay $41,000 and the trade payables are paid $26,000. The cost of dissolution is $4400. Prepare the ledger accounts necessary to record the dissolution.

Transcribed Image Text:

Sara and Tracey Statement of financial position at 30 November 2014 $ Non-current assets at book value 180 000 Current assets Inventory 24 500 Trade receivables 42 600 Cash at bank 4 600 71 700 Total assets 251 700 Capital accounts Sara 110 000 Tracey 114 000 224 000 Current liabilities Trade payables 27 700 Total capital and liabilities 251 700