INSTALLMENT LIQUIDATION

ABC Partnership provided the following account balances before partnership liquidation
Cash 12,000.00
Non-cash assets 100,000.00
Total Assets 112,000.00

Accounts payable 28,000.00

A, Loan 2,000.00
B, Loan 5,000.00
A, Capital 3 34,000.00
B, Capital 5 25,000.00
C, Capital 2 18,000.00
Total Liabilities and Capital 112,000.00

Non-cash assets were sold for

Liquidating Restricted
Book Value Sales Price Expense Cash
January 30,000.00 22,000.00 2,000.00 500.00
February 25,000.00 16,000.00 1,000.00 400.00
March 30,000.00 10,000.00 200.00
April 15,000.00 2,000.00

Prepare the Partnership Liquidation Statement

Record the Partnership Liquidation

Non-cash Accounts
Particulars Cash assets payable A, Loan
Balances before liquiation 12,000.00 100,000.00 28,000.00 2,000.00
January realization 22,000.00 (30,000.00)
Balances 34,000.00 70,000.00 28,000.00 2,000.00
Payment of liquidating exp (2,000.00)
Balances 32,000.00 70,000.00 28,000.00 2,000.00
Payment of Accounts Payable (28,000.00) (28,000.00)
Balances 4,000.00 70,000.00 - 2,000.00
Settlement to partners Sch1 (3,500.00) (2,000.00)
Balances 500.00 70,000.00 - -
February realization 16,000.00 (25,000.00)
Balances 16,500.00 45,000.00 - -
Payment of liquidating exp (1,000.00)
Balances 15,500.00 45,000.00 - -
Settlement to partners Sch2 (15,100.00)
Balances 400.00 45,000.00 - -
March realization 10,000.00 (30,000.00)
Balances 10,400.00 15,000.00 - -
Settlement to partners Sch3 (10,200.00)
Balances 200.00 15,000.00 - -
April realization 2,000.00 (15,000.00)
Balances 2,200.00 - - -
Right of off-set
Balances 2,200.00 - - -
FINAL SETTLEMENT (2,200.00)
 30% 50% 20% Schedule of Safe Payments

B, Loan A, Capital B, Capital C, Capital

5,000.00 34,000.00 25,000.00 18,000.00 Schedule 1
(2,400.00) (4,000.00) (1,600.00)
5,000.00 31,600.00 21,000.00 16,400.00 Partners' Interest
(600.00) (1,000.00) (400.00) Less: Estimated loss
5,000.00 31,000.00 20,000.00 16,000.00 Total
Absorption
5,000.00 31,000.00 20,000.00 16,000.00 Total
(1,500.00) Absorption
5,000.00 29,500.00 20,000.00 16,000.00 Settlement
(2,700.00) (4,500.00) (1,800.00)
5,000.00 26,800.00 15,500.00 14,200.00 Schedule 2
(300.00) (500.00) (200.00)
5,000.00 26,500.00 15,000.00 14,000.00 Partners' Interest
(11,260.00) (3,840.00) Less: Estimated loss
5,000.00 15,240.00 15,000.00 10,160.00 Total
(6,000.00) (10,000.00) (4,000.00) Absorption
5,000.00 9,240.00 5,000.00 6,160.00 Settlement
(2,400.00) (4,680.00) (3,120.00)
2,600.00 4,560.00 5,000.00 3,040.00 Schedule 3
(3,900.00) (6,500.00) (2,600.00)
2,600.00 660.00 (1,500.00) 440.00 Partners' Interest
(1,500.00) 1,500.00 Less: Estimated loss
1,100.00 660.00 - 440.00 Settlement
(1,100.00) (660.00) (440.00)

Cash Priority Program

Partners' Interest
/ Profit and loss ratio
Total Loss Absorption Capacity
Priority 1: A
Balances
Priority 2: A and C
Balances
Priority 3: P and L ratio

January Settlement
Priority 1: A
Totals

Febuary Settlement
Priority 1: A Balance
Balances
Priority 2: A and C
Totals

March Settlement
Priority 2: A and C Balance
Balances
Priority 3: P and L ratio
Totals
 30% 50% 20%
A B C
33,000.00 25,000.00 16,000.00
(70,500.00) (21,150.00) (35,250.00) (14,100.00)
11,850.00 (10,250.00) 1,900.00
(6,150.00) 10,250.00 (4,100.00)
5,700.00 - (2,200.00)
(2,200.00) 2,200.00
3,500.00 - -

30% 50% 20%

A B C
26,500.00 20,000.00 14,000.00
(45,400.00) (13,620.00) (22,700.00) (9,080.00)
12,880.00 (2,700.00) 4,920.00
(1,620.00) 2,700.00 (1,080.00)
11,260.00 - 3,840.00
 30% 50% 20%
A B C
9,240.00 10,000.00 6,160.00
(15,200.00) (4,560.00) (7,600.00) (3,040.00)
4,680.00 2,400.00 3,120.00

Partners' Interest Settlement to Partners

A B C A B C Total
36,000.00 30,000.00 18,000.00
30% 50% 20%
ption Capacity 120,000.00 60,000.00 90,000.00
(30,000.00) 9,000.00 9,000.00
90,000.00 60,000.00 90,000.00
(30,000.00) (30,000.00) 9,000.00 6,000.00 15,000.00
60,000.00 60,000.00 60,000.00

A B C
3,500.00
(3,500.00) 3,500.00
- 3,500.00 - -

A B C
15,100.00
(5,500.00) 5,500.00
9,600.00
(9,600.00) 5,760.00 3,840.00
- 11,260.00 - 3,840.00

A B C
10,200.00
(5,400.00) 3,240.00 2,160.00
4,800.00
(4,800.00) 1,440.00 2,400.00 960.00
- 4,680.00 2,400.00 3,120.00
INSTALLMENT LIQUIDATION

ABC Partnership provided the following account balances before partnership liquidation
Cash 12,000.00
Non-cash assets 100,000.00
Total Assets 112,000.00

Accounts payable 28,000.00

A, Loan 2,000.00
B, Loan 5,000.00
A, Capital 3 34,000.00
B, Capital 5 25,000.00
C, Capital 2 18,000.00
Total Liabilities and Capital 112,000.00

Non-cash assets were sold for

Liquidating Restricted
Book Value Sales Price Expense Cash
January 30,000.00 22,000.00 2,000.00 500.00
February 25,000.00 16,000.00 1,000.00 400.00
March 30,000.00 10,000.00 200.00
April 15,000.00 2,000.00

Prepare the Partnership Liquidation Statement

Record the Partnership Liquidation

Non-cash Accounts
Particulars Cash assets payable A, Loan
Balances before liquiation 12,000.00 100,000.00 28,000.00 2,000.00
January realization 22,000.00 (30,000.00)
Balances 34,000.00 70,000.00 28,000.00 2,000.00
Payment of liquidating exp (2,000.00)
Balances 32,000.00 70,000.00 28,000.00 2,000.00
Payment of Accounts Payable (28,000.00) (28,000.00)
Balances 4,000.00 70,000.00 - 2,000.00
Settlement to partners Sch1 (3,500.00) (2,000.00)
Balances 500.00 70,000.00 - -
February realization 16,000.00 (25,000.00)
Balances 16,500.00 45,000.00 - -
Payment of liquidating exp (1,000.00)
Balances 15,500.00 45,000.00 - -
Settlement to partners Sch2 (15,100.00)
Balances 400.00 45,000.00 - -
March realization 10,000.00 (30,000.00)
Balances 10,400.00 15,000.00 - -
Settlement to partners Sch3 (10,200.00)
Balances 200.00 15,000.00 - -
April realization 2,000.00 (15,000.00)
Balances 2,200.00 - - -
Right of off-set
Balances 2,200.00 - - -
FINAL SETTLEMENT (2,200.00)
 30% 50% 20% JOURNAL ENTRIES

B, Loan A, Capital B, Capital C, Capital

5,000.00 34,000.00 25,000.00 18,000.00 Cash
(2,400.00) (4,000.00) (1,600.00) A, Capital
5,000.00 31,600.00 21,000.00 16,400.00 B, Capital
(600.00) (1,000.00) (400.00) C, Capital
5,000.00 31,000.00 20,000.00 16,000.00 Non-cash assets

5,000.00 31,000.00 20,000.00 16,000.00 A, Capital

(1,500.00) B, Capital
5,000.00 29,500.00 20,000.00 16,000.00 C, Capital
(2,700.00) (4,500.00) (1,800.00) Cash
5,000.00 26,800.00 15,500.00 14,200.00
(300.00) (500.00) (200.00) Accounts payable
5,000.00 26,500.00 15,000.00 14,000.00 Cash
(11,260.00) (3,840.00)
5,000.00 15,240.00 15,000.00 10,160.00 A, Loan
(6,000.00) (10,000.00) (4,000.00) A, Capital
5,000.00 9,240.00 5,000.00 6,160.00 Cash
(2,400.00) (4,680.00) (3,120.00)
2,600.00 4,560.00 5,000.00 3,040.00 Cash
(3,900.00) (6,500.00) (2,600.00) A, Capital
2,600.00 660.00 (1,500.00) 440.00 B, Capital
(1,500.00) 1,500.00 C, Capital
1,100.00 660.00 - 440.00 Non-cash assets
(1,100.00) (660.00) (440.00)
A, Capital
B, Capital
C, Capital
Cash

A, Capital
C, Capital
Cash

Cash
A, Capital
B, Capital
C, Capital
Non-cash assets

B, Loan
A, Capital
C, Capital
Cash

Cash
A, Capital
B, Capital
C, Capital
Non-cash assets

B, Loan
B, Capital

B, Loan
A, Capital
C, Capital
Cash
 DR CR
22,000.00
2,400.00
4,000.00
1,600.00
30,000.00

600.00
1,000.00
400.00
2,000.00

28,000.00
28,000.00

2,000.00
1,500.00
3,500.00
16,000.00
2,700.00
4,500.00
1,800.00
25,000.00

300.00
500.00
200.00
1,000.00

11,260.00
3,840.00
15,100.00

10,000.00
6,000.00
10,000.00
4,000.00
30,000.00

2,400.00
4,680.00
3,120.00
10,200.00

2,000.00
3,900.00
6,500.00
2,600.00
15,000.00

1,500.00
1,500.00

1,100.00
660.00
440.00
2,200.00