Statement of Realization and Liquidation

ATBR 950,000.00 AR 631,500.00

AA 66,500.00 ANR 420,000.00
LL 350,000.00 LTBL 650,000.00
LNL 318,500.00 LA 18,500.00
Supplementary Dr 408,500.00 Supplementary Cr 301,500.00
Net Loss 72,000.00
Total 2,093,500.00 Total 2,093,500.00
 Assets
Liabilities
Cash Noncash
Beginning 50,000.00 950,000.00 650,000.00
(i) 250,000.00 (265,000.00)
(ii) 115,000.00 (115,000.00)
(iii) 15,000.00 15,000.00
(iv) (350,000.00) (350,000.00)
(v) 1,500.00
186,500.00 (151,500.00)
(vi) (75,000.00) 3,500.00
(vii) (15,000.00)
Balance 176,500.00 420,000.00 318,500.00
596,500.00 596,500.00

Net income (loss)

 Estate Equity
(Estate Deficit)
Journal entries: Label
350,000.00 (i) Cash 250,000.00
(15,000.00) AR 50,000.00 Additional asset acquired
Sales 300,000.00 Supplementary credit

COGS 315,000.00 Supplementary debit

1,500.00 MI 315,000.00 Asset realized
35,000.00
(78,500.00) (ii) Cash 115,000.00 Asset realized
(15,000.00) AR 115,000.00
278,000.00
(iii) MI 15,000.00 Asset acquired
AP 15,000.00 Liabilities assumed
(72,000.00)
(iv) AP 350,000.00
Cash 350,000.00 Liabilities liquidated

(v) Interest Receivable 1,500.00 Asset acquired

Interest Income 1,500.00 Supplementary credit

Cash 186,500.00 Asset realized

FVPL 150,000.00
Interest Rec. 1,500.00
Gain on real. 35,000.00

(vi) Liquidation Expense 75,000.00 Supplementary debit

Cash 75,000.00

Liquidation Expense 3,500.00 Supplementary debit

Other Payable 3,500.00 Liabilities assumed

(vii) Bad Debts Expense 15,000.00 Supplementary debit

Accounts Receivable 15,000.00 Assets realized
Additional asset acquired
Supplementary credit

Supplementary debit
Asset realized

Asset realized

Asset acquired
Liabilities assumed

Liabilities liquidated
Alternative:
Asset acquired Cash 186,500.00 Asset realized (185,000 for the FVPL only)
Supplementary credit FVPL 150,000.00
Interest Inc 1,500.00 Supplementary credit
Asset realized Gain on real 35,000.00

Supplementary debit

Supplementary debit
Liabilities assumed

Supplementary debit
Assets realized
 Noncash

Estate equity, end of October (18,500.00) Estate equity, beg of November

Liabilities, end of October 310,000.00 Liabilities, beg of November
Liabilities assumed 15,000.00 Liabilities assumed, November
Assets realized/sold 235,000.00 Assets sold, November
Increase in assets 36,000.00 Assets acquired, November
Assets to be realized in December 13,000.00 Assets not realized, November
Liabilities to be paid in December 30,800.00 Liabilities not paid, November
Supplementary credits 100,800.00 Supplementary credits, November
Supplementary debits 28,750.00 Supplementary debits, November
Estate equity, end of November (12,450.00) Estate equity, end of November
ATBR ? AR 235,000.00 Equity, beg. (18,500.00)
AA 36,000.00 ANR 13,000.00 NI (Loss) 6,050.00
LL 294,200.00 LTBL 310,000.00 Equity, end (12,450.00)
LNL 30,800.00 LA 15,000.00
Supp Dr 28,750.00 Supp Cr 100,800.00
Net Income 6,050.00 Net Loss XX
Total 673,800.00 Total 673,800.00

In this scenario, we still have 2 question marks.

So what do we do? Assume that there is no G/L on liquidation

Liab, beg. 310,000.00

Assumed 15,000.00
Liab paid (294,200.00) SQUEEZE
Liab, end 30,800.00

Cash, beg Noncash, beg Liab, beg. Equity, beg.

13,500.00 278,000.00 310,000.00 (18,500.00)