TAILIEUCHUNG - Lecture Advanced accounting (11/e): Chapter 15 - Hoyle, Schaefer, Doupnik

Chapter 15 - Partnerships: Termination and liquidation. When you finish this chapter, you should: Determine amounts to be paid to partners in a liquidation; prepare journal entries to record the transactions incurred in the liquidation of a partnership; determine the distribution of available cash when one or more partners have a deficit capital balance or become personally insolvent. | Chapter Fifteen Partnerships: Termination and Liquidation Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Reasons for Termination Termination of business activities followed by liquidation of partnership property occurs for a variety of reasons: Personality disputes between partners Retirement Death Changed business environment Other opportunities Low profits Bankruptcy (either the business or a partner) 15- Reasons for Termination Termination of business activities followed by liquidation of partnership property occurs for a variety of reasons: Personality disputes between partners Retirement Death Changed business environment Other opportunities Low profits Bankruptcy (either the business or a partner) Termination & Liquidation When the partners wish to terminate the business: Convert all assets to cash. Allocate all gains or losses to the partner capital balances. Pay all liabilities and expenses. Distribute remaining cash to partners. LO 1 15- Termination & Liquidation When the partners wish to terminate the business: Convert all assets to cash. Allocate all gains or losses to the partner capital balances. Pay all liabilities. Distribute remaining cash to partners. Termination & Liquidation - Example According to their agreement, Morgan & Houseman divide profits 6:4 respectively. On 6/1, the inventory is sold for $15,000. Note that the loss on the sale of inventory of $7,000 is assigned $4,200 ($7,000 x 60%) Morgan and $2,800 ($7,000 x 40%) to Houseman. LO 2 15- According to their agreement, Morgan & Houseman divide profits 6:4 respectively. On 6/1, the inventory is sold for $15,000. Note that the loss on the sale of inventory of $7,000 is assigned $4,200 ($7,000 x 60%) Morgan and $2,800 ($7,000 x 40%) to Houseman. Deficit Capital Balance Deficit balances can be resolved two ways: The deficit partner can make a contribution to make up the deficit. The remaining partners can absorb the deficit. (The deficit

• Kế toán - Kiểm toán
• Advanced accounting
• Lecture Advanced accounting
• Advanced financial accounting
• Financial statements
• Accounting valuation
• Statement of liquidation
• Equity method of accounting
• International accounting diversity
• Accounting for legal reorganizations
• Accounting for state
• Accounting for leases
• Accounting for estates
• Investment accounting
• Consolidation of financial information
• Consolidated financial statements
• Intra entity asset transactions
• Variable interest entities
• Income taxes
• Interim reporting
• Foreign currency transactions
• Foreign currency financial statements
• Exchange commission
• Partnership advantages