CASH PRIORITY PROGRAM

The balance sheet of Blossom, Bubbles and Buttercup, partners sharing profits in the ratio of 4:3:3
respectively, showed the following balances on April 30, 20xx, just before the liquidation:

Powerpuff Girls
Statement of Financial Position
April 30, 20xx

Assets Liabilities and Capital

Cash P 315,000 Liabilities P 435,000
Non-Cash Assets 1,250,000 Buttercup, Loan 30,000
Blossom, Capital 600,000
Bubble, Capital 350,000
Buttercup, Capital 150,000

Total Assets P 1,565,000 Total Liabilities and Capital P 1,565,000

In May, part of the assets are sold at book value, P300,000. In June, the remaining assets are sold for
P210,000. Assume that the available cash is distributed to the proper parties at the end of May and at the
end of June. Assume further that partners are solvent and that any partner who is deficient made
appropriate payment to the partnership on July 31.

Required:
1. Prepare the necessary journal entries.
2. Prepare the cash priority program and statement of liquidation.

SCHEDULE OF SAFE PAYMENTS

Linny the Guinea Pig, Mingming Duckling and Turtle Tuck divide profits 60%, 25% and 15%
respectively. A balance sheet on June 30, 20xx, just before partnership liquidation, showed the following
balances

Wonderpets
Statement of Financial Position
June 30, 20xx

Assets Liabilities and Capital

Cash P 50,000 Liabilities P 350,000
Non-Cash Assets 925,000
Linny, Capital 450,000
Mingming, Capital 100,000
Tuck, Capital 75,000

Total Assets P 975,000 Total Liabilities and Capital P 975,000

Certain assets are sold in July at book value of P500,000 and available cash is distributed to appropriate
parties, Remaining assets sold in August for P150,000 and cash is distributed in the final settlement.

Required:
1. Prepare the necessary journal entries.
2. Prepare the schedule of safe payments and statement of liquidation.