Practice Data And Problems for Principles of Accounting

Roy B Roy Bernard Kester

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2. Prepare a statement accounting for the impairment of capital.
PROBLEM IX It has been mutually agreed that Joseph Mason shall act as liquidating partner with full authority to sell all property, pay all debts and distribute liquidating dividends among the partners. Mason's fee as liquidator shall be 5% commis- sion on the converted value of all the assets and is to be paid at each dividend date.
Interest is to be allowed on the loan accounts and profits and losses are to be shared % by Howe a...nd % each by Mason and Bartlett, during the period of liquidation.
Settlements are to be made on the last day of each month.
Based on the post-closing trial balance in Problem VIII and the information given below: 1. Prepare a working sheet which will present the information in convenient form for preparing the statements incidental to liquidation.
2. Show the partners' loan accounts properly closed for each period.
3. Set up the partners' capital accounts, balancing each account after the payment of each liquidating dividend.

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