The partnership of Flo and Fay is in the process of liquidation. On January 1, 2011, the
Question:
The partnership of Flo and Fay is in the process of liquidation. On January 1, 2011, the ledger shows account balances as follows:
Cash ........................................ $10,000
Accounts receivable ....................... 25,000
Lumber inventory ......................... 40,000
Accounts payable ........................ $15,000
Flo capital .................................. 40,000
Fay capital ................................. 20,000
On January 10, 2011, the lumber inventory is sold for $25,000, and during January, accounts receivable of $21,000 is collected. No further collections on the receivables are expected. Profits are shared 60 percent to Flo and 40 percent to Fay.
REQUIRED
Prepare a schedule showing how the cash available on February 1, 2011, should be distributed.
Accounts ReceivableAccounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...
Step by Step Answer:
Schedule of Capital Balances 60 Flo 40 Fay Capital balances January 1 2011 40000 2000...View the full answer
Advanced Accounting
ISBN: 978-0133451863
12th edition
Authors: Floyd A. Beams, Joseph H. Anthony, Bruce Bettinghaus, Kenneth Smith
