required information qs 12 - 13 (algo) liquidation of partnership lo p5 (the following information applies…

required information qs 12 - 13 (algo) liquidation of partnership lo p5 (the following information applies to the questions displayed below.) the field, brown & snow are partners and share income and losses equally. the partner decide to liquidate the partnership when their capital balances are as follows: field, $131,900; brown, $166,200; and snow, $154,500. on may 31, the liquidation resulted in a loss of $405,900. qs 12 - 13 (algo) part 1 1. compute the capital account balance of each partner after the loss from liquidation is allocated. note: losses and negative capital balances, if any, should be entered as a negative value.

required information qs 12 - 13 (algo) liquidation of partnership lo p5 (the following information applies to the questions displayed below.) the field, brown & snow are partners and share income and losses equally. the partner decide to liquidate the partnership when their capital balances are as follows: field, $131,900; brown, $166,200; and snow, $154,500. on may 31, the liquidation resulted in a loss of $405,900. qs 12 - 13 (algo) part 1 1. compute the capital account balance of each partner after the loss from liquidation is allocated. note: losses and negative capital balances, if any, should be entered as a negative value.

Answer

Explanation:

Step1: Calculate loss allocation per - partner

Since the partners share income and losses equally and the total loss is $405,900, the loss allocation per partner is $\frac{405900}{3}=135300$.

Step2: Calculate Field's capital balance

Field's initial capital is $131900$. After allocating the loss, the balance is $131900 - 135300=- 3400$.

Step3: Calculate Brown's capital balance

Brown's initial capital is $166200$. After allocating the loss, the balance is $166200 - 135300 = 30900$.

Step4: Calculate Snow's capital balance

Snow's initial capital is $154500$. After allocating the loss, the balance is $154500 - 135300 = 19200$.

Step5: Calculate the total capital balance

The total capital balance is $-3400+30900 + 19200=36700$.

Field Brown Snow Total
Initial investments $131900$ $166200$ $154500$ $452600$
Loss allocation $- 135300$ $-135300$ $-135300$ $-405900$
Capital balances $-3400$ $30900$ $19200$ $36700$

Answer:

Field Brown Snow Total
Initial investments $131900$ $166200$ $154500$ $452600$
Loss allocation $- 135300$ $-135300$ $-135300$ $-405900$
Capital balances $-3400$ $30900$ $19200$ $36700$