Answer:
Bell, Mann, and Scott Partnership
Statement of Partnership Liquidation
Bell Mann Scott Total
Capital account balances $215,000 $150,000 $90,000 $455,000
Share of net loss (55,000) (33,000) (22,000) (110,000)
Capital account balances $160,000 $117,000 $68,000 345,000
Cash payment -160,000 -117,000 -68,000 -345,000
Ending balance $0 $0 $0 $0
Explanation:
a) Data and Calculations:
Assets:
Cash, $93,000
Non-cash Assets, $725,000
Total assets $818,000
Liabilities, $363,000
Bell, capital $215,000
Mann, capital $150,000
Scott, capital $90,000
Total liabilities and owners capital $818,000
Profit and Loss Sharing Ratios:
Bell = 50%
Mann = 30%
Scott = 20%
Loss arising from the sale of non-cash assets and liabilities:
Book Value Cash Collected/Paid Loss/Gain
$565,000 $465,000 -$100,000
$160,000 $130,000 -$30,000
Gain from adjustment of liabilities:
$120,000 $100,000 $20,000
Net Loss to be shared among partners $110,000
Cash account
Balance $93,000
Non-assets 465,000
Non-assets 130,000 595,000
Liabilities (100,000)
Liabilities (243,000) (344,000)
Distributable balance $345,000
