Professional Documents
Culture Documents
CH 16
CH 16
Chapter 16
Order of Payment
Understand installment
liquidations.
Cash 60,000
Duro, Capital 10,000
Kemp, Capital 6,000
Roth, Capital 4,000
Equipment, net 80,000
To record sale of equipment at a $20,000 loss
Cash 180,000
Duro, Capital 30,000
Kemp, Capital 18,000
Roth, Capital 12,000
Inventories 240,000
To record sale of remaining inventory items at a $60,000 loss
3 Prentice Hall Business Publishing, Advanced Accounting 8/e, Beams/Anthony/Clement/Lowensohn 16 - 26
February Liquidation Events
$$$
Priority Kemp
Liabilities Loan Duro Kemp Roth
Cash $60,000 — —
West, capital (30%) 18,000 $18,000 $21,000
York, capital (30%) 18,000 27,000 9,000
Zeff, capital (40%) 24,000 9,000 12,000