The partnership of Frick, Wilson, and Clarke has elected to cease all operations and liquidate its business property. A balance sheet drawn up at this time shows the following account balances:
|Noncash assets||285,000||Frick, capital (60%)||171,000|
|Wilson, capital (20%)||46,000|
|Clarke, capital (20%)||97,000|
|Total assets||$||354,000||Total liabilities and capital||$||354,000|
Prepare a predistribution plan for this partnership
The following transactions occur in liquidating this business:
Produce a final statement of liquidation for this partnership using the predistribution plan to determine payments of cash to partners based on safe capital balances.
Prepare journal entries to record the liquidation transactions reflected in the final statement of liquidation.