For a long time (in a galaxy far, far away), the partnership…
For a long time (in a galaxy far, far away), the partnership of Yoda, Qui-Gon Jinn, Obi-Wan Kenobi, and Mace Windu has operated a Jedi training academy. Based on the provisions of the partnership agreement, all profits and losses have been allocated on a 4:3:2:1 ratio, respectively. Recently, both Qui-Gon and Obi-Wan have undergone personal financial problems and as a result, these two individuals are now insolvent. To satisfy their personal legal obligations, the partnership must be liquidated. At the time that active operations cease and the liquidation is begun, the following balance sheet is produced for this partnership: Additional information: The property, plant, and equipment shown on the balance sheet is net of $100,000 accumulated depreciation. The partnership decided to liquidate gradually in 20X2. The following amounts were received from the sales of assets during January and February, 20X2: On January 31, equipment that had a book value of $200,000 (cost was $275,000) was sold for $225,000. On February 28, the accounts receivable and inventories were sold for $100,000. Liquidating expenses of $18,000 were paid in February. The partners agree to distribute the maximum amount of cash that can be safely distributed at the end of each month. The partnership agreement provides that, unless otherwise stated, the default provisions of the UPA of 1997 apply. Required: Insert a table in the field below to prepare a statement of partnership realization and liquidation for both January and February. Be sure that you prepare any appropriate safe payment schedules (by inserting additional tables as needed).
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