How do construct the journal entry to record the payment

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Reference no: EM132719797

Partnership dissolution

Brown, Blue and Black decide to dissolve their partnership on 15 April 2003. The statement of financial position on that date is presented below. Profits and losses are shared 2:1:2.

Required:

Question A. Prepare the Realization account to record sale of the assets as follows:

1. Sold the inventory for $72 000.

2. Collected $48 000 on accounts receivable and wrote off the remaining accounts.

3. Sold the equipment for $192 000.

4. Sold the building and the land for $1 200 000, the buyer taking over the mortgage on the building.

Question B. Prepare the journal entry to record the payment of accounts payable (in full).

Question C. Prepare the journal entry to allocate the gain or loss on realization to the partners' Capital accounts.

Question D. Prepare the statement of financial position after the entries for requirements A, B and C are posted.

Question E. Prepare journal entries to record the distribution of the remaining cash to the partners.

Reference no: EM132719797

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