Problem #5 Lump-Sum Liquidation

1. Sales on Non-cash Assets

Cash 460,000
Loss on Realization 540,000
Non-cash Assets 1,000,000

2. Distribution of Loss on Realization to partners

Escareal, Capital 180,000 (540k * 2/6)
Acosta, Capital 270,000 (540k * 3/6)
Lopez, Capital 90,000 (540k * 1/6)
Loss on Realization 540,000

3. Payment of Liabilities
Accounts Payable 250,000
Cash 250,000

4. Capital Deficit Absorbed by Solvent Partners

Escareal, Capital 40,000 (60k * 2/3)
Lopez, Capital 20,000 (60k * 1/3)
Acosta, Capital 60,000

5. Distribution of Cash to Partners

Escareal, Capital 80,000
Lopez, Capital 280,000
Cash 360,000

Escareal, Acosta and Lopez Partnership

Statement of Liquidation
December 31, 2023
Cash Non-cash Accounts Escareal, Acosta, Lopez,
assets payable Capital Capital Capital
Ratio 2:6 3:6 1:6
Balances 150,000 1,000,000 250,000 300,000 210,000 390,000
before
liquidation
Sales of 460,000 (1,000,000 (180,000) (270,000 (90,000)
non-cash ) )
assets and
distribution
of losses
Balances 610,000 250,000 120,000 (60,000) 300,000
Payments (250,000) (250,000)
of
Liabilities
to outside
creditors
Balances 360,000
Additional (40,000) 60,000 (20,000)
losses to
Escareal
and Lopez
Balances 360,000 80,000 280,000
Payment (360,000) (80,000) (280,000)
to
Partners

Problem 6
1. Sales of Assets
Cash 900,000
Loss on Realization 300,000
Assets 1,200,000

2. Distribution of Loss on Realization

Modesto, Capital 200,000 (300k * 2/3)
Corpuz, Capital 100,000 (300k * 1/3)
Loss on Realization 300,000

3. Payment of Liabilities
Liabilities 150,000
Cash 150,000

4. Distribution of Cash Partner’s

Modesto, Capital 400,000
Corpuz, Capital 350,000
Cash 750,000

Assets Liabilities Modesto, Corpuz,

Capital Capital
Balance 1,200,000 150,000 600,000 450,000
before
liquidation
Sales of (1,200,000) (200,000) (100,000)
Assets and
Distribution
of Losses
Cash 900,000 150,000 400,000 350,000
received
Balances 900,000 150,000 400,000 350,000
Payment of (150,000) 150,000
Liabilities
Balances 750,000 400,000 350,000
Payments to (750,000) (400,000) (350,000)
Partners

Problem #7
Assets Natividad, Capital Ungria Jr., Capital
Cash Balances 820,000 340,000 360,000
Gain on 60,000 60,000
Realizatiom
{(820k-340k-
360k)= (120K)}
Balances 820,000 400,000 420,000
Payment to (820,000) (400,000) (420,000)
Partners

1. Distribution of Gain in Realization

Gain on Realization 120,000
Natividad, Capital 60,000 (120k * 50%)
Ungria Jr., Capital 60,000
2. Distribution of Cash to Partners
Natividad, Capital 400,000
Ungria Jr., Capital 420,000
Cash 820,000

Problem #8
1. 60,000
2. Soria, Capital 30,000 (60k * 50%)
Paras, Capital 30,000
Loss on Realization 60,000
3. Soria, Capital 120,000
Paras, Capital 40,000
Cash 160,000
Assets Soria, Capital Paras, Capital
Cash Balances 160,000 150,000 70,000
Loss on (30,000) (30,000)
Realization
{(1600k-1500k-
70k= (60k)}
Balances 160,000 120,000 40,000
Payments to (160,000) (120,000) (40,000)
Partners
PROBLEM 9
1. Loss on realization 500,00
Orcajada, Capital 250,000
Morales, Capital 250,000
Loss on realization 500,000
2. Robert Capital 450,000
Ryan, Capital 650,000
Orcajada, Capital 450,000
Morales, Capital 650,000
Cash 1,100,000

PROBLEM 10
Hungaria and Blanche Partnership
Statement of Liquidation
June 30, 2021
Assets Liabilities Hungria, Blanche,
Capital Capital
Profit and 3/4 1/4
loss ratio
Percentages
Balances 1,000,000 250,000 400,000 350,000
before
liquidation
Sale of 800,000 (1,000,000) (150,000) (50,000)
Assets
Balances 800,000 250,000 250,000 300,000
Payment of (250,000) (250,000)
liabilities
Balances 550,000 250,000 300,000
Payment to (550,000) (250,000) (300,000)
partners`
Computation:
Loss on Realization: 800,000-1,000,000= (200,000)
Distribution of loss
Hungaria: 200,000 x ¾ = 150,000
Blanche: 200,000 x ¼= 50,000
Answer:
Cash distribution to each partners:
Hungaria: 400,000-150,000= 250,000
Blanche: 350,000-50,000= 300,000
PROBLEM 11
Required 1
Aparece, Bantilles, Lerin Partnership
Statement of Partnership Liquidation
December 31, 2023
20% 40% 40%
Transac Cash NCA Liabilitie Bantill Aparece Bantilles Lerin,
tions s es, , Capital , Capital Capital
Loan
Payabl
e
Balance 25,000 475,000 240,000 30,000 120,000 50,000 60,000
before
liquidati
on
Realizat 260,000 (475,00 (43,000) (86,000) (86,000)
ion of 0)
assets
and
distributi
on of
loss
Balance 285,000 - 240,000 30,000 77,000 (36,000) (26,000)
Paymen (240,000) (240,00
t of 0)
Liability
Balance 45,000 - - 30,000 77,000 (36,000) (26,000)
Right of (30,00 30,000
offset 0)
Balance 45,000 - - - 77,000 (6,000) (26,000)
Investm 31,000 6,000 25,000
ent
Balance 76,000 - - - 77,000 - 1,000
Absorpti (333) (667) (1,000)
on of
loss
Balance 76,0000 76,667 (667)
Addition 667 667
al
Investm
ent
Balance 76,667 76,667
s
 Paymen (76,667) (76,667)
t to
partners
Required 2
Cash 260,000
Aparece, Capital 43,000
Bantilles, Capital 86,000
Lerin, Capital 86,000
Accounts Receivable 75,000
Inventories 100,000
Property and Equipment (net) 300,000

Accounts Payable 240,000

Cash 240,000

Briones, Loan 30,000

Briones, Capital 30,000

Cash 31,000
Bantilles, Capital 6,000
Lerin, Capital 25,000

Aparence, Capital 333

Bantilles, Capital 667
Lerin, Capital 1,000

Cash 667
Bantilles, Capital 667

Aparece, Capital 76,667

Cash 76,667
PROBLEM 12
1.
Sarabia Selisana Gevera Total
Capital 600,000 (240,000) 360,000 720,000
balances
before
liquidation
Absorption of (120,000) 240,000 (120,000) -
deficiency
Balances 480,000 - 240,000 720,000
after
absorption
Payment to (480,000) - (240,000) (720,000)
partners
Balances - - - -
after
payment

2.
Sarabia Selisana Gevera Total
Capital 600,000 (240,000) 360,000 720,000
balances
before
liquidation
Additional 240,000 240,000
investment
Balances 600,000 - 360,000 960,000
after
investment
Payment to (600,000) - (360,000) (960,000)
partners
Balances - - - -
after
payment
3.
Sarabia Selisana Gevera Total
Capital 600,000 (240,000) 360,000 720,000
balances
before
liquidation
Additional 144,000 144,000
investment
(60%)
Balances after 600,000 (96,000) 360,000 864,000
investment
Absorption of (48,000) 96,000 (48,000) -
defiency
Balance after 552,000 - 312,000 864,000
absorption
Payment to (552,000) (312,000) (864,000)
partners
Balances after - - - -
payment
PROBLEM 13
Jan.6, 2022
Cash 151,500
Allowance for Uncollectible accounts 11,100
Tugade, Capital 10,800 (27,000 * 40%)
Masinsin, Capital 10,800 (27,000 * 40%)
Biore, Capital 5,400 (27,000 * 20%)
Accounts Receivable 189,600

Computation:
Cash received 151,500
Accounts Receivable 189,600
Allowance for Uncollectible Accounts (11,100) (178,500)
Loss (27,000)
Jan. 9, 2022
Cash 160,500
Tugade, Capital 53,040 (132,600 * 40%)
Masinsin, Capital 53,040 (132,600 * 40%)
Biore, Capital 26,520 (132,600 * 20%)
Merchandise Inventory 293,100
Computation:
Cash Received 160,050
Merchandise Inventory (293,100)
Loss (132,600)
Jan. 11
Cash 3,000
Tugade, Capital 2,400 (6,000 * 40%)
Masinsin, Capital 2,400 (6,000 * 40%)

Biore, Capital 1,200 (6,000 * 20%)

Prepaid insurance 9,000
Computation
Cash Received 3,000
Prepaid Insurance (9,000)
Loss 6,000
Jan. 14
Cash 111,000
Mortgage Payable 240,000
Accumulated-Depreciation- Office Equipment 10,500
Accumulated- Depreciation- Machinery 32,100
Accumulated Depreciation- Building 112,500
Tugade, Capital 40,800 (102,000 *40%)
Masinsin, Capital 40,800 (102,000 *40%)
Biore, Capital 20,400 (102,000 *20%)
Land 120,000
Office Equipment 31,500
Machinery 81,600
Building 375,000
Computation
Cash Received 111,000
Mortgage payable 240,000
Net equipment (10,500-31,500) (21,000)
Net machinery (32,100-81,600) (49,500)
Net building (112,500-375,000) (252,000)
Land (120,000)
(102,000)
Jan. 20
Notes Payable 120,000
Accounts Payable 220,500
Cash 340,500
Jan. 20
Tugade, Capital (4/6) 31,360
Biore, Capital (2/6) 15,680
Masinsin, Capital 47,040
Computation: Masinsin, Capital 135,000
(10,800)
(53,040)
(2,400)
(40,800)
(31,360)
(3,400)
Jan. 20
Biore, Capital 3,400
Tugade, Capital 3,400
Computation: Tugade, Capital 135,000
(10,800)
(53,040)
 (2,400)
(40,800)
(31,360)
(3,400)
Jan. 24
Biore, Capital 127,500
Cash 127,500
PROBLEM 14
PROBLEM 15
PROBLEM 19
PROBLEM 20
PROBLEM 21
PROBLEM 22