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    Norma1218's Avatar
    Norma1218 Posts: 1, Reputation: 1
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    #1

    Feb 15, 2008, 03:18 PM
    Liquidation of a Company
    I have two companies and am trying to close out one of them. They are related one to the other, but they are in two different states. I have almost all the accounts zeroed out but need to transfer the Inter company Accounts, and then recognize the gain on Liquidation of the company. I understand the journal entry that I need to make is as follows:
    Dr. Inter company Acct
    Cr. Gain on Liquidation of Co.

    And the J/E in the company that I am keeping is a follows:
    Dr. Loss on Liquidation of Co
    Cr. Inter company accounts

    I don't know exactly what account is affected in the Gain on Liquidation of the Company. It is in the P&L, but what account is that. Is that a Gain/Loss on Sale or Transfer of Assets? I am not really transferring assets. Is money that one company had borrowed from the other.

    Please help!
    Thank you.
    MaggieMouse's Avatar
    MaggieMouse Posts: 226, Reputation: 8
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    #2

    Feb 20, 2008, 02:01 PM
    Depends on how these two companies are related. Is one a subsidiary of the other? Why do you need to move the accounts?

    If you have a gain on one, I think you should have the gain, not a loss, no matter how you move them.
    sykhai's Avatar
    sykhai Posts: 3, Reputation: 1
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    #3

    Mar 3, 2008, 06:10 PM
    How do you liquidate for 3 partners with ratio of 1:5:4 ratio with loss of 29,000?
    MaggieMouse's Avatar
    MaggieMouse Posts: 226, Reputation: 8
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    #4

    Mar 5, 2008, 09:39 AM
    Just use the 3 percentages times the loss amount. $2900, $14500, and $11600.
    IQlady's Avatar
    IQlady Posts: 1, Reputation: 1
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    #5

    Nov 18, 2010, 07:54 AM
    Move the Gain or Loss on liquidation to Shareholder Distribution account
    israelkaguo's Avatar
    israelkaguo Posts: 1, Reputation: 1
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    #6

    Feb 24, 2011, 11:26 PM
    Computation of liquidator remunaration
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