Sedgwick Company at December 31 has cash $20,000, noncash assets $100,000, liabilities $55,000, and the following capital balances: Floyd $45,000 and DeWitt $20,000. The firm is liquidated, and $105,000 in cash is received for the noncash assets. Floyd and DeWitt income ratios are 60% and 40%, respectively.

Instructions

Prepare a schedule of cash payments.

 

Transcribed Image Text:

SEDGWICK COMPANY Schedule of Cash Payments Item Cash Noncash Liabilities Floyd, DeWitt, + + Assets Capital Capital Balance before liquidation $20,000 $100,000 $55,000 $45,000 $20,000 Sale of noncash assets and allocation of gain New balances Pay liabilities New balances Cash distribution to partners Final balances SEDGWICK COMPANY Schedule of Cash Payments Item Cash Noncash Liabilities Floyd, DeWitt, + + Assets Capital Capital Balance before liquidation $20,000 $100,000 $55,000 $45,000 $20,000 Sale of noncash assets and allocation of gain New balances Pay liabilities New balances Cash distribution to partners Final balances

Answer rating: 100% (QA)

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