The partnership of Wing, Mehta, Rodgers, and Yan was formed several years ago as a local architectural firm. Several partners have recently undergone personal financial problems and have decided to terminate operations and liquidate the business. The following balance sheet is drawn up as a guideline for this process:

When the liquidation commenced, liquidation expenses of $16,000 were anticipated as being necessary to dispose of all property.

Part APrepare a predistribution plan for this partnership.

Part B

The following transactions transpire during the liquidation of the Wing, Mehta, Rodgers, and Yan partnership:

1. Collected 80 percent of the total accounts receivable with the rest judged to be uncollectible.

2. Sold the land, building, and equipment for $150,000.

3. Distributed safe payments of cash.

4. Learned that Yan, who has become personally insolvent, will make no further contributions.

5. Paid all liabilities.

6. Sold all inventory for $71,000.

7. Distributed safe payments of cash again.

8. Paid actual liquidation expenses of $11,000 only.

9. Made final cash disbursements to the partners based on the assumption that all partners other than Yan are personally solvent.

Prepare journal entries to record these liquidation transactions.

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Cash Accounts receivable... Inventory... Land..... Building and equipment (net)... Total assets. $ 15,000 82,000 101,000 85,000 168,000 $451,000 Liabilities.... Rodgers, loan. Wing, capital (30%) Mehta, capital (10%). Rodgers, capital (20%). Yan, capital (40%) ..... Total liabilities and capital..... $ 74,000 35,000 120,000 88,000 74,000 60,000 $451,000