Balance sheet before liquidation and cash distribution among partners?

Question

Masers XYZ is in the process of liquidation. The general Ledger balances are:

Dr

Cash: 20,800

Accounts Receivables: 116,800

Cr:

Liabilities: 36,800

X, Capital: 43,200

Y, Capital: 33,600

Z, Capital: 24,000

Collection of $ 66,400 is made on receivables, and the remainder is considered noncollectable,.

how will we prepare the balance sheet before liquidation? Also, how would a schedule be formed, showing the cash distribution among the partners?

Answer 1

prepare balance sheet before liquidation

Dr:

Cash 20,800

Accounts receivable 116,800

Total assets $137,600

Cr:

Liabilities 36,800

X, Capital 43,200

Y, Capital 33,600

z, Capital 24,000

Total liabilities & owners’ capital $137,600

and schedule of distribution of cash among partners.

Cash before distribution = $20,800 + $66,400 - $36,800 = $50,400

Divide this $50,400 among the partners in the same proportion as their capital -

X $21,600

Y $16,800

Z $12,000

Total $50,400