Advance Accounting

Open Book, 90 menit

Dra. Yusriyati Nur Farida, Msi ak

1. RVO Corp. sold a piece of real estate on January 2, 2009 for $15,000,000. It had
purchased the property in 2001 for $11500,000 in cash. At that time the land was worth
$500,000. At the time of the sale, the carrying value of the building was $4,500,000.
The terms of the sale were as follows:
Downpayment $ 5. 500,000
Note Receivable $ 9,500,000
Interest rate 10%
Length of mortgage 20 years
Annual payment $ 1,115,866 due at end of each year

The sale has been consummated, the seller's receivable is not subject to future subordination, and
the seller has no continuing involvement with the property. However, because the initial
investment is inadequate, the seller must use the installment method to account for this sale.
REQUIRED: Journal entries needed in 2009, and 2010

2. The Partnership of Denver ,Elsie, Fannie and George is being liquidated over the first few
months of 2003. The trial balance at January 1, 2003 isas follws :

Debits Credits
Cash $200,000
Accounts receivable 56,000
Inventory 142,000
Equipment(net) 300,000
Land 150,000
Loan to Denver 30,000
Accounts payable $400,000
Denver capital (20%) 170,000
Elsie capital(10%) 90,000
FannieCapital (50%) 140,000
George capital (20%) ______________ 78,000
$878,000 $878,000
 Aadditional information
1. The partners agreeto retain $20,000 cash on hand for contingencies and distribute the
rest of the available cash at the end of each month.
2. In January have of receivables were collected . Inventory that cost $75,000 was
liquidated for $45,000. The land was sold $250,000

Required : Prepare a schedule of sale payments for the Denver, Elsie, Fannie, George partnership
for January 31, 2003