Installment liquidation—Safe payments schedules
The balance sheet of Roger, Susan, and Tom, who share partnership profits 30 percent, 30 percent, and 40 percent, respectively, included the following balances on January 1, 2011, the date of dissolution:
|
Cash |
$ 20,000 |
Liabilities |
$ 40,100 |
|
Other assets |
130,000 |
Loan from Roger |
5,000 |
|
Loan to Susan |
10,000 |
Roger capital |
9,900 |
|
Susan capital |
45,000 |
||
|
Tom capital |
60,000 |
||
|
$160,000 |
$160,000 |
During January 2011, part of the firm’s assets are sold for $40,000. In February the remaining assets are sold for $21,000. Assume that available cash is distributed to the proper parties at the end of January and at the end of February.
REQUIRED: Prepare a statement of partnership liquidation with supporting safe payments schedules for each cash distribution. (It will not be possible to determine the actual gains and losses in January.)