The WhizBamBoom partnership began with investments by the partners as follows: Whiz, $231,200; Bam, $177,200; and Boom, $191,600. The first
1. Calculate the capital account balances of the partners after the liquidation of assets and payment of creditors.
2. Assume that any partner with a deficit pays cash to the partnership to cover the deficit. Present the General Journal entries on December 31 to record the cash receipt from the deficient partner(s) and the final disbursement of cash to the partners.
3. Now make the contrary assumption that any partner with a deficit is not able to reimburse the partnership. Present journal entries:
(a) To transfer the deficit of any deficient partners to the other partners, and
(b) To record the final disbursement of cash to the partners.
Liquidation in finance and economics is the process of bringing a business to an end and distributing its assets to claimants. It is an event that usually occurs when a company is insolvent, meaning it cannot pay its obligations when they are due.... 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...
This problem has been solved!
Do you need an answer to a question different from the above? Ask your question!
Step by Step Answer:
Create a free account to access the answer
Cannot find your solution?
Post a FREE question now and get an answer within minutes. * Average response time.
Question Posted: January 08, 2015 08:49:57