Question $4(15$ marks$)$

On August $1,$ Year $4,$ Novack, Otto, and Pender agree to liquidate their partnership.

Capital balances are:

The partners share net income$/$loss in a ratio of $4$:$3$:$3.$ Accounts payable is $$60,000.$ Assets

are shown on the balance sheet at cash of $$40,000$ and $$177,500$ of other assets. The other

assets are sold for $$159,500.$

Required

a$.$ Prepare a journal entry to show the sale of the non$-$cash assets and a second entry to

allocate any corresponding gain or loss on this to the partners.

b$.$ Prepare a journal entry to pay the liabilities.

c$.$ Prepare a journal entry to distribute the remaining cash to the partners.