1.

Watin is solvent partner

WATIN AND VELOSO PARTNERSHIP
Statement of Partnership Liquidation
As of ___________

Cash

Balances before Realization 20 000

Sale of non-cash asets and distribution of gain 85 000
Balances 105 000
Payment of Liabilities (60 000)
Balances 45 000
Watin's Loan offset against his capital deficiency _______
Balances 45 000
Watin's additional cash for his capital deficiency 7 000
Balances 52 000
Cash Distribution
to Partners (52 000)

JOURNAL ENTRIES:
Debit

Cash 85 000
Watin, Capital 57 000
Veloso, Capital 38 000
Non-cash assets
To record sale of non-cash assets
and distribution of realization loss.

Accounts Payable 60 000

Cash
To record payment of liability.

Watin, Loan 10 000

Watin, Capital
To offset Watin's loan account
to his capital deficiency
Cash 7 000
Watin, Capital
To record additional cash
of Watin for his deficiency

Veloso, Capital 52 000

Cash
To distribute remaining cash to
partner.
D VELOSO PARTNERSHIP
f Partnership Liquidation
of ___________
PARTNERS' CAPITAL BALANCES
Non- Watin 60% 40%
Cash Liabilities Loan Watin Veloso

180 000 60 000 10 000 40 000 90 000

(180 000) (57 000) (38 000)
60 000 10 000 (17 000) 52 000
(60 000)
10 000 (17 000) 52 000
(10 000) 10 000 _______
(7 000) 52 000
7 000 _______
52 000

(52 000)

Credit

180 000

60 000

10 000
7 000

52 000
2. Watin is insolvent partner
WATIN AND VELOSO PARTNERSHIP
Statement of Partnership Liquidation
As of ___________

Cash

Balances before Realization 20 000

Sale of non-cash asets and distribution of gain 85 000
Balances 105 000
Payment of Liabilities (60 000)
Balances 45 000
Watin's Loan offset against his capital deficiency _______
Balances 45 000
Deficiency of Watin to be absorbed by Veloso ______
Balances 45 000
Cash Distribution
to Partners (45 000)

JOURNAL ENTRIES:
Debit

Cash 85 000
Watin, Capital 57 000
Veloso, Capital 38 000
Non-cash assets
To record sale of non-cash assets
and distribution of realization loss.

Accounts Payable 60 000

Cash
To record payment of liability.

Watin, Loan 10 000

Watin, Capital
To offset Watin's loan account
to his capital deficiency
Veloso, Capital 7 000
Watin, Capital
To record the absorption
of Veloso to Watin's deficiency.

Veloso, Capital 45 000

Cash
To distribute remaining cash to
partner.
D VELOSO PARTNERSHIP
f Partnership Liquidation
of ___________
PARTNERS' CAPITAL BALANCES
Non- Watin 60% 40%
Cash Liabilities Loan Watin Veloso

180 000 60 000 10 000 40 000 90 000

(180 000) (57 000) (38 000)
60 000 10 000 (17 000) 52 000
(60 000)
10 000 (17 000) 52 000
(10 000) 10 000 _______
(7 000) 52 000
7 000 (7 000)
45 000

(45 000)

Credit

180 000

60 000

10 000
7 000

45 000