On January 1 the partners of Van Bakel and Cox

On January 1, the partners of Van, Bakel, and Cox (who share profits and losses in the ratio of
5:3:2, respectively) decide to liquidate their partnership. The trial balance at this date
follows:The partners plan a program of piecemeal conversion of the business’s assets to
minimize liquidation losses. All available cash, less an amount retained to provide for future
expenses, is to be distributed to the partners at the end of each month. A summary of the
liquidation transactionsfollows:January Collected $51,000 of the accounts receivable; the
balance is deemed uncollectible.Received $38,000 for the entire inventory.Paid $2,000 in
liquidation expenses.Paid $50,000 to the outside creditors after offsetting a $3,000 credit
memorandum received by the partnership on January 11.Retained $10,000 cash in the
business at the end of January to cover any unrecorded liabilities and anticipated expenses.
The remainder is distributed to the partners.February Paid $3,000 in liquidation
expenses.Retained $6,000 cash in the business at the end of the month to cover unrecorded
liabilities and anticipated expenses.March Received $146,000 on the sale of all machinery and
equipment.Paid $5,000 in final liquidation expenses.Retained no cash in the business.Prepare a
schedule to compute the safe installment payments made to the partners at the end of each of
these threemonths. View Solution: On January 1 the partners of Van Bakel and Cox
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