(Solution) - The partnership of Flo and Fay is in the process -(2025 Original AI-Free Solution)

Paper Details

The partnership of Flo and Fay is in the process of liquidation. On January 1, 2011, the ledger shows account balances as follows:
Cash ........................................ $10,000
Accounts receivable ....................... 25,000
Lumber inventory ......................... 40,000
Accounts payable ........................ $15,000
Flo capital .................................. 40,000
Fay capital ................................. 20,000
On January 10, 2011, the lumber inventory is sold for $25,000, and during January, accounts receivable of $21,000 is collected. No further collections on the receivables are expected. Profits are shared 60 percent to Flo and 40 percent to Fay.
REQUIRED
Prepare a schedule showing how the cash available on February 1, 2011, should be distributed.