Danielle Matthews said Ms Bush told her about the killing while drunk
A woman accused of killing a salesman and dumping his body parts told a friend her co-accused had carried out the murder, a jury has heard.
Pieces of Jeffrey Howe's body were found in Hertfordshire and Leicestershire last March and April.
Stephen Marshall, 38, of Borehamwood, Hertfordshire, and Sarah Bush, 21, of Southgate, London, deny murder.
St Albans Crown Court heard Ms Bush had told a friend while drunk that there was "a lot of blood" and "a foot".
The pair are accused of murdering the 49-year-old in March 2009.
Mr Marshall has admitted dismembering Mr Howe and disposing of his body parts.
He also pleaded guilty to two counts of perverting the course of justice.
The first involved giving false information about the whereabouts of Mr Howe when police were conducting a missing person investigation.
Secondly, he admitted dismembering the victim's body and disposing of the parts in different places to impede the investigation.
Ms Bush denies dismembering Mr Howe and disposing of his body parts.
Giving evidence, Danielle Matthews said Ms Bush told her about the killing while drunk: "She said it started in the bathroom.
Jeffrey Howe's body parts were found dumped in two counties
"She was saying 'lots of blood', 'a foot', 'dismembered', 'constriction of breath'.
"She said Steve was goading Jeff about moving out of his home... he turned around to Jeff and said 'get out of your home, I'll kill you and your family'."
The court heard Mr Marshall and Ms Bush became boyfriend and girlfriend after they met through an escort agency and he paid for sex.
Ms Matthews, who also worked for the escort agency, said Ms Bush told her about a cheque paid into her account from Mr Howe's account.
She said Mr Marshall was buying cocaine with Mr Howe's money.
On 30 March, Ms Bush went to Ms Matthews' house and after getting drunk on beer and sambuca, Ms Bush told her about the killing, the court heard.
"She said 'Steve killed Jeff'," Ms Matthews said.
"I understood he died either by being strangled or by smothering but she did say 'lots of blood'. She never said why he done it."
Ms Bush had two daughters, aged four and two, but struggled to see them once she was in a relationship with Marshall who had allegedly been violent towards the girls' father, Ms Matthews said.
Witness Sophie Franklin, a hairdresser in her 20s, said she was told on a separate occasion that Steve killed Jeff by stabbing him in the back.
"Jeff was screaming and Steve was screaming at Sarah to put a pillow over Jeff's mouth.
"(She said) there was blood everywhere, even on the ceiling."
She also described how Mr Marshall had obtained Mr Howe's bank details and had written cheques to put in Ms Bush's account.
The trial was adjourned until Tuesday morning.