Statement of partnership liquidation
The partnership of Alice, Betty, and Carle became insolvent during 2011, and the partnership ledger shows the following balances after all partnership assets have been converted into cash and all available cash distributed:
|
Debit |
Credit |
|
|
Accounts payable |
$ 30,000 |
|
|
Alice capital |
20,000 |
|
|
Betty capital |
$120,000 |
|
|
Carle capital |
70,000 |
|
|
$120,000 |
$120,000 |
Profit and loss sharing percentages for the three partners are Alice, 30 percent; Betty, 40 percent; and Carle, 30 percent. The personal assets and liabilities of the partners are as follows
|
Alice |
Betty |
Carle |
|
|
Personal assets |
$60,000 |
$110,000 |
$60,000 |
|
Personal liabilities |
50,000 |
60,000 |
40,000 |
REQUIRED: Prepare a schedule to show the phaseout of the partnership and final closing of the books if the partnership creditors recover $30,000 from Betty.