Grell, Hamilton, Kieffer, and Mally have been operating a consulting business as a partnership. Based on...

  

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Grell, Hamilton, Kieffer, and Mally have been operating a consulting business as a partnership. Based on the provisions of the original articles of partnership, all profits and losses have been allocated on a 4:2:2:2 ratio, respectively. The partners have had difficulty agreeing which clients to pursue and decided they could no longer work together. As a result, they decided to liquidate the partnership. They ceased operations on December 31, 2019. The partnership balance sheet reflects the following: Cash Accounts Receivable Office Furniture, net GHKM Consulting Balance Sheet December 31, 2019 Total Assets $ 20,000 Accounts Payable 100,000 Bank Loan Payable 80,000 Grell, Capital $ 10,000 20,000 95,000 Hamilton, Capital 20,000 Kieffer, Capital 25,000 Mally, Capital 30,000 $200,000 Total Liabilities & Capital $200,000 The partnership anticipates they will incur $5,000 of costs to liquidate their noncash assets. H During the liquidation process the following transactions occur in 2020: January 15 Collected $60,000 of cash from accounts receivable Paid $20,000 cash to bank to retire loan January 20 January 24 January 25 Sold office furniture with a book value of $50,000 for $35,000 cash Distributed safe capital balances to the partners Paid $10,000 cash for accounts payable January 27 January 31 Sold remaining office furniture for $20,000 cash February 3 Sold remaining accounts receivable for $30,000 cash Paid final liquidation expenses of $8,000 February 10 February 28 Distributed remaining cash to the partners to close the partnership Required: • Prepare a pre-distribution plan as of December 31, 2019 . Prepare journal entries to record the actual liquidation transactions Prepare a schedule of liquidation as of February 28, 2020 . Grell, Hamilton, Kieffer, and Mally have been operating a consulting business as a partnership. Based on the provisions of the original articles of partnership, all profits and losses have been allocated on a 4:2:2:2 ratio, respectively. The partners have had difficulty agreeing which clients to pursue and decided they could no longer work together. As a result, they decided to liquidate the partnership. They ceased operations on December 31, 2019. The partnership balance sheet reflects the following: Cash Accounts Receivable Office Furniture, net GHKM Consulting Balance Sheet December 31, 2019 Total Assets $ 20,000 Accounts Payable 100,000 Bank Loan Payable 80,000 Grell, Capital $ 10,000 20,000 95,000 Hamilton, Capital 20,000 Kieffer, Capital 25,000 Mally, Capital 30,000 $200,000 Total Liabilities & Capital $200,000 The partnership anticipates they will incur $5,000 of costs to liquidate their noncash assets. H During the liquidation process the following transactions occur in 2020: January 15 Collected $60,000 of cash from accounts receivable Paid $20,000 cash to bank to retire loan January 20 January 24 January 25 Sold office furniture with a book value of $50,000 for $35,000 cash Distributed safe capital balances to the partners Paid $10,000 cash for accounts payable January 27 January 31 Sold remaining office furniture for $20,000 cash February 3 Sold remaining accounts receivable for $30,000 cash Paid final liquidation expenses of $8,000 February 10 February 28 Distributed remaining cash to the partners to close the partnership Required: • Prepare a pre-distribution plan as of December 31, 2019 . Prepare journal entries to record the actual liquidation transactions Prepare a schedule of liquidation as of February 28, 2020 .

Answer rating: 100% (QA)

profit Da cash on 1900 sale of Office Furnity Account Receipt lost ratio 4222 PRE distribution plan ... View the full answer