2016 Lee Jan 1 vehicles taken over Share of profit 6 56000 200000 28000 6 Share

2016 lee jan 1 vehicles taken over share of profit 6

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2016 Lee $ Jan 1 vehicles taken over 0 Share of profit 6 56,000 200,000 28,000 6. Share the profit or loss on realisation among the partners in the profit and loss sharing ratio (i) When there is a profit on realisation: Dr Realisation account Cr Partners’ capital accounts (with their share of profit on realisation)
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Accounting entries for dissolution Current 2016 Chan $ Lee $ 2016 Chan $ Lee $ Jan 1 Capital 7 260,000 200,000 Jan 1 Balances b/f 260,00 0 200,000 The numbers in blue represent the entries shown in the table on Slide 10 – 12. 2016 Lee $ Jan 1 Realisation — Motor vehicles taken over 3 220,00 0 Jan 1 1 1 Balances b/f Realisation — Share of profit Current 6 7 300,000 56,000 260,000 200,000 28,000 200,000 7. Transfer the partners’ current account balances to their capital accounts (i) For current accounts with credit balances: Dr Partners’ current accounts Cr Partners’ capital accounts (with the credit balances in current accounts)
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Accounting entries for dissolution The numbers in blue represent the entries shown in the table on Slide 10 – 12. 2016 Jan 1 1 over Bank — Final settlement (Note 3) 8 616,00 0 220,00 208,00 0 1 Current 7 260,000 200,000 616,00 0 428,00 0 616,000 428,000 Bank 2016 $ 2016 $ Jan 1 1 Balance b/f Realisation — Office equipment Inventory Accounts receivable 2 2 2 106,000 480,000 270,000 204,000 Jan 1 1 1 Accounts payable Realisation — Dissolution costs Capital — Final settlement (Note 3) Chan Lee 4 5 8 8 210,000 26,000 616,000 208,000 1,060,00 8. Settle the final balances in the partners’ capital accounts (i) For capital accounts with credit balances: Dr Partners’ capital accounts Cr Cash/Bank account (with the credit balances in capital accounts)
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Exhibit 13.2 A more complicated example Paul, Martin and Raymond were partners, sharing profits and losses in the ratio of 3 : 2 : 1. The following is the statement of financial position of the partnership as at 31 March 2015:
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Exhibit 13.2 A more complicated example Paul, Martin and Raymond Statement of Financial Position as at 31 March 2015 ASSETS Non-current assets $ Cost $ Accumulat ed depreciati on $ Net book value Machinery Office furniture 640,000 300,000 940,000 380,000 150,000 530,000 260,000 150,000 410,000 Goodwill 100,000 510,000 Current assets Inventory Trade receivables Less Allowance for doubtful debts 170,000 14,000 86,000 156,000 Cash 12,000 254,000 Total assets 764,000
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Paul, Martin and Raymond Statement of Financial Position as at 31 March 2015 $ $ $ Exhibit 13.2 A more complicated example EQUITY AND LIABILITIES Capital: Paul Martin Raymond 100,000 100,000 100,000 300,000 Current: Paul Martin Raymond Non-current liabilities 84,000 (94,000) 82,000 72,000 372,000 Loan from Raymond 100,000 Current liabilities Trade payables Bank overdraft 210,000 82,000 292,000 Total liabilities 392,000 Total equity and liabilities 764,000
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Exhibit 13.2 A more complicated example On 1 April 2015, Paul, Martin and Raymond dissolved the partnership on the following terms: 1.The machinery and office furniture were sold at 80% and 70% of their net book value, respectively. 2.Paul took over the inventory at 60% of its book value, but he was also personally responsible for paying off half of the trade payables.
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  • Spring '07
  • Smith
  • Balance Sheet, realisation, Dr Partners

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