The MFP Partnership is to be liquidated when the ledger shows the following: Cash $50,000 Noncash Assets 200,000 Liabilities 50,000 Mossimo, Capital 75,000 Fandango, Capital 100,000 Plank, Capital 25,000 Mossimo, Fandango, and Plank’s income ratios are 6:3:1, respectively. Prepare separate entries to record the liquidation of the partnership assuming that the noncash assets are sold for $140,000 in cash.
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The MFP
| Cash | $50,000 | |
| Noncash Assets | 200,000 | |
| Liabilities | 50,000 | |
| Mossimo, Capital | 75,000 | |
| Fandango, Capital | 100,000 | |
| Plank, Capital | 25,000 |
Mossimo, Fandango, and Plank’s income ratios are 6:3:1, respectively.
Prepare separate entries to record the liquidation of the partnership assuming that the noncash assets are sold for $140,000 in cash.
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- When a partnership dissolves, the last step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partnersWhen a partnership dissolves, the first step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partnersThe partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after Tatum receives a 10,000 salary and Brook receives a 15,000 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $40,000 B. $25,000 C. ($5,000) In addition, show the resulting entries to each partners capital account. Tatums capital account balance is $50,000 and Brooks is $60,000.
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