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.

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 $610,800.

(2) Inventory is sold for $458,400.

(3) Inventory is sold for $321,600 and any partners with capital deficits pay in the amount of their deficits.

(4) Inventory is sold for $240,000 and the partners have no assets other than those invested in the partnership.

Transcribed Image Text:

Assets Cash Inventory Total assets KENDRA, COGLEY, AND MEI Balance Sheet May 31 Liabilities and Equity $ 97,100 542,400 $639,500 Accounts payable Kendra, Capital Cogley, Capital Mei, Capital Total liabilities and equity $256,500 76,600 172,350 134,050 $639,500 Assets Cash Inventory Total assets KENDRA, COGLEY, AND MEI Balance Sheet May 31 Liabilities and Equity $ 97,100 542,400 $639,500 Accounts payable Kendra, Capital Cogley, Capital Mei, Capital Total liabilities and equity $256,500 76,600 172,350 134,050 $639,500

Answer rating: 100% (QA)

1 Step1 Determination of gain loss Proceeds from the sale of inventory 61080000 Inventory Cost 54240000 Gain On Sale 6840000 Step2 Allocation of GainL... View the full answer