Question 5 Sedgwick Company at December 31 has cash $20,961, noncash assets $103
ID: 2418896 • Letter: Q
Question
Question 5
Sedgwick Company at December 31 has cash $20,961, noncash assets $103,000, liabilities $51,040, and the following capital balances: Floyd $42,720 and DeWitt $30,201. The firm is liquidated, and $119,900 in cash is received for the noncash assets. Floyd and DeWitt income ratios are 65% and 35%, respectively.
Prepare a schedule of cash payments. (If an amount reduces the account balance then enter with a negative sign preceding the number e.g. -15,000 or parenthesis e.g. (15,000).)
SEDGWICK COMPANY
Schedule of Cash Payments
Item
Cash
Noncash Assets
Liabilities
Floyd, Capital
DeWitt, Capital
$20,961
$103,000
$51,040
$42,720
$30,201
Open Show Work
SEDGWICK COMPANY
Schedule of Cash Payments
Item
Cash
+Noncash Assets
=Liabilities
+Floyd, Capital
+DeWitt, Capital
Balance before liquidation$20,961
$103,000
$51,040
$42,720
$30,201
Sale of noncash assets and allocation of gain New balances Pay liabilities New balances Cash distribution to partners Final balances$
$
$
$
$
Explanation / Answer
Item Cash + Non Cash Assets = Libilities + Floyd Capital + DeWitt Capital Balance before Liquidation $20,961 $103,000 $51,040 $42,720 $30,201 Sale of noncash assets and allocation of gain $119,900 $(103,000) $10,985(65% 0f (119,900-103,000) $5,915 35% 0f (119,900-103,000) New balances $140,861 0 $51,040 $53705 $36,116 Pay liabilities $(51,040) $(51,040) New balances $89,821 0 0 $53,705 $36,116 Cash distribution to partners (89,821) 0 0 $(53,705) $(36,116) Final Balances 0 0 0 0 0
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