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# Lesson 23 3

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### Lesson 23 3

1. 1. CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 23-3LESSON 23-3 Dissolving a Partnership
2. 2. 2 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning ACCOUNT BALANCES BEFOREACCOUNT BALANCES BEFORE REALIZATIONREALIZATION page 686
3. 3. 3 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning GAIN ON REALIZATIONGAIN ON REALIZATION page 686 1. Calculate the gain. 2. Record the entry. 22 August 1, 20--. Received cash from sale of truck, \$13,000.00: original cost, \$20,000.00; total accumulated depreciation recorded to date, \$8,000.00. Receipt No. 316. Gain on Realization =Book Value of Asset Sold –Value of Asset Received \$1,000.00=–Cash \$13,000.00 Cost \$20,000.00 Accum. Depr. 8,000.00 Book Value \$12,000.00 11
4. 4. 4 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LOSS ON REALIZATIONLOSS ON REALIZATION page 687 1. Calculate the loss. 2. Record the entry. 22 August 1. Received cash from sale of supplies, \$1,100.00; balance of supplies account, \$1,500.00. Receipt No. 317. Loss on Realization =Book Value of Asset Sold –Value of Asset Received \$(400.00)=–Cash \$1,100.00 Supplies \$1,500.00 11
5. 5. 5 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LIQUIDATING LIABILITIESLIQUIDATING LIABILITIES page 688 August 4, 20--. Paid cash to all creditors for the amounts owed, \$4,000.00. Check No. 422.
6. 6. 6 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning ACCOUNT BALANCES AFTER LIQUIDATIONACCOUNT BALANCES AFTER LIQUIDATION OF NONCASH ASSETS AND PAYMENT OFOF NONCASH ASSETS AND PAYMENT OF LIABILITIESLIABILITIES page 688
7. 7. 7 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning \$360.00 240.00 \$600.00 = = 60% 40% × × \$600.00 \$600.00 Walker Jeter Total Share of the Balance of Loss and Gain on Realization =Fixed Percentage ×Balance of Loss and Gain on Realization DISTRIBUTING LOSS OR GAIN ONDISTRIBUTING LOSS OR GAIN ON REALIZATION TO PARTNERSREALIZATION TO PARTNERS page 689 August 6, 20--. Recorded distribution of gain on realization: to Adam Walker, \$360.00; to Shirley Jeter, \$240.00. Memorandum No. 412. 1. Calculate each partner’s share of gain or loss. 2. Record entry to distribute gain or loss. 22 11
8. 8. 8 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning DISTRIBUTING REMAINING CASH TODISTRIBUTING REMAINING CASH TO PARTNERSPARTNERS page 689 August 6. Recorded final distribution of remaining cash to partners: to Adam Walker, \$18,360.00; to Shirley Jeter, \$12,740.00. Check Nos. 423 and 424.
9. 9. 9 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning TERMS REVIEWTERMS REVIEW  liquidation of a partnership  realization  limited liability partnership (LLP) page 690
10. 10. 9 LESSON 23-3CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning TERMS REVIEWTERMS REVIEW  liquidation of a partnership  realization  limited liability partnership (LLP) page 690