The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners have reached retirement age, and the partners have decided to terminate operations and liquidate the business. Liquidation expenses of $55,000 are expected. The partnership balance sheet at the start of liquidation is as follows: Cash $51,000 Liabilities $191,000
Accounts receivable 81,000 Butler, loan 51,000
Office equipment (net) 71,000 Butler, capital (25%) 155,000
Building (net) 215,000 Osman, capital (25%) 51,000
Land 205,000 Ward, capital (50%) 175,000
Total assets $623,000 Total liabilities and capital $623,000

Required:
1. Prepare a predistribution plan for this partnership.
2. The following transactions transpire in chronological order during the liquidation of the partnership:

a. Collected 90 percent of the accounts receivable and wrote the remainder off as uncollectible.
b. Sold the office equipment for $20,000, the building for $80,000, and the land for $120,000.
c. Made safe capital distributions.
d. Paid all liabilities in full.
e. Paid actual liquidation expenses of $30,000 only.
f. Made final cash distributions to the partners.

Prepare journal entries to record these liquidation transactions.