ex 185 the mfp partnership is to be liquidated when the ledger shows the following c 4325014

Ex. 185

The MFP Partnership is to be liquidated when the ledger shows the following:

Cash$  50,000

Noncash Assets200,000

Liabilities50,000

Mossimo, Capital75,000

Fandango, Capital100,000

Plank, Capital25,000

Mossimo, Fandango, and Plank’s income ratios are 6:3:1, respectively.

Instructions

Prepare separate entries to record the liquidation of the partnership assuming that the noncash assets are sold for $140,000 in cash.

Ex. 186

Prior to the distribution of cash to the partners, the accounts of ABC Company are: Cash $35,000, Acock, Capital (Dr.) $5,000, Buster, Capital (Cr.) $25,000, and Cutter, Capital (Cr.) $15,000. They share income on a 5:3:2 basis.

Instructions

Prepare entries to record (a) the absorption of Acock’s capital deficiency by the other partners and (b) the distribution of cash to the partners with credit balances.

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