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procedures in lump sum liquidation 1.finish the accounting cycle. a.adjust the books. b.determine the grab income/net redness and close the net income/net injustice to mates non bad(p) of the United States accounts. c.close all nominal accounts. d.close all conscription accounts to their respective slap-up accounts. 2.sell non-cash assets and distribute progress or spillage on recognition among partners using get ahead and expiration ratio. a.any involution between the selling set and carrying amount of the sold assets shall be recorded in an account called gain or waiver on acknowledgment. b.the gain or loss on realization account shall be closed to the partners ceiling accounts using receipts and loss ratio. 3.if partners heavy(p) offset results in a debit entry parallelism ( unequal correspondence), the followers may happen: a.if a partner has a lead balance exercise the right of offset (apply the loan balance against the debit balan ce). b.if there is no loan or if neat balance still results in a debit balance: b.1 if partner is solvent and a general partner lacking(predicate) partnermakes special cash investment to remove his capital deficiency. b.

2 if partner is bankrupt and general partner or if bound partner deficient partner is unable to remuneration; the rest solvent partners will take the deficiency. 4.cash is to be distributed in the following order of priority: a.first, to outside partnership creditors. b.second,to partners for loan accounts. c.third, to partners for capital accounts. note:the final diffusion of cash to part ners is made base on the partners capital ! balances and not based on the profit and loss ratio. marivic valenzuela-manalo 3 5.when cash is not sufficient to pay creditors, the solvent general partners shall contribute the difference using their loss ratioIf you want to get a full(a) essay, order it on our website: OrderCustomPaper.com

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