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 $600,000.
2. Inventory is sold for $500,000.
3. Inventory is sold for $320,000 and any partners with capital deficits pay in the amount.

Transcribed Image Text:

KENDRA, COGLEY, AND MEI Balance Sheet May 31 Assets Liabilities and Equity Cash $ 180,800 Accounts payable $ 245,500 Inventory 537,200 Kendra, Capital 93,000 Cogley, Capital 212,500 Mei, Capital Total liabilities and equity 167,000 Total assets $ 718,000 $ 718,000 KENDRA, COGLEY, AND MEI Balance Sheet May 31 Assets Liabilities and Equity Cash $ 180,800 Accounts payable $ 245,500 Inventory 537,200 Kendra, Capital 93,000 Cogley, Capital 212,500 Mei, Capital Total liabilities and equity 167,000 Total assets $ 718,000 $ 718,000

Answer rating: 100% (QA)

SOLUTION 1 INVENTORY IS SOLD FOR 600000 S NO PARTICULARS DEBIT CREDIT A CASH DR 600000 TO INVENTORY ... View the full answer