The partners in Shawnee Company decide to liquidate the firm when the balance sheet shows the following.

The partners share income and loss 5 : 3 : 2. During the process of liquidation, the transactions below were completed in the following sequence.

1. A total of $43,000 was received from converting noncash assets into cash.

2. Liabilities were paid in full.

3. Cash was paid to the partners with credit balances.

Instructions

(a) Prepare a cash distribution schedule.

(b) Prepare the entries to record the transactions.

(c) Post to the cash and capital accounts.

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SHAWNEE COMPANY Balance Sheet April 30, 2008 Assets Liabilities and Owners' Equity Cash $28,000 Notes payable $16,000 Accounts receivable 19,000 Accounts payable 24,000 Allowance for doubtful accounts (1,000) Wages payable 2,000 Merchandise inventory 28.000 Neeley, Capital 23,000 Equipment 17,000 Hannah, Capital 11,200 Accumulated depreciation-equipment (10,000) Doonan, Capital 4,800 Total $81,000 Total $81,000