Problem
Ray Douglas Seth Vida, and Vlad Warden are liquidating their partnership. Before selling the assets and paying the? liabilities, the capital balances are Douglas $48,000; Vida, $29,000; and Warden, $17,000. The? profit-and-loss-sharing ratio has been 3:1:1 for Douglas, Vida, and Warden?, respectively. The partnership has $71,000 cash, $48,000 non-cash assets, and $25,000 accounts payable
Requirements
1. Assuming the partnership sells the non-cash assets for $55,000, record the journal entries for the sale of non-cash assets, allocation of gain or loss on liquidation, the payment of the outstanding liabilities, and the distribution of remaining cash to partners.
2. Assuming the partnership sells the non-cash assets for $17,000, record the journal entries for the sale of non-cash assets, allocation of gain or loss on liquidation, the payment of the outstanding liabilities, and the distribution of remaining cash to partners.