A series of payments made to partners during partnership liquidation is called a continuous liquidation
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A series of payments made to partners during
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- When a partnership liquidates, do partners get paid first or do creditors get paid first?When a partnership dissolves, the last step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partnersWhen a partnership dissolves, the first step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partners
- What are the four steps involved in liquidating a partnership?Prior to proceeding with the liquidation, the partnership should ________. A. prepare adjusting entries without closing B. complete the accounting cycle for final operational period C. prepare only closing entries D. complete financial statements onlyWhen a partnership is liquidated, any gains or losses realized by the sale of noncash assets are allocated to the partners based on their income sharing ratio. Why?
- In a partnership liquidation, a gain from the sale of assets is allocated to the: a. Payment of partnership liabilities b. Partner with the lowest capital balances first c. Partners based on their capital balances d. Partners based on their profit and loss ratioThere is a liquidation of assets of a partnership. Describe the order in which assets must be distributed upon liquidation of a partnership, and explain the "right-of-offset" concept.In partnership liquidation the first cash distribution to the partner should be made in accordance with the Select one: a. Ratio of the capital contribution by partners b. Balances of partners' capital accounts c. Partners profit &loss ratios d. Safe payment schedule
- What is a predistribution plan? A list of the procedures to be performed during a liquidation. A guide for the cash distributions to partners during a liquidation. A determination of the final cash distribution to the partners on the settlement date. A detailed list of the transactions that will transpire in the reorganization of a partnership.In the installment liquidation of a partnership, each installment of cash is distributed: a) As if no more cash would be forthcoming b) In the partners’ profit and loss ratio c) In the ratio of partner’s capital account balances d) As agreed to by the partnersIn accounting for the lump-sum liquidation of a partnership, cash payments to partners after all non-partner creditors’ claims have been satisfied, but before the final cash distribution should be according to: a. Safe payment computations. b. The final balances in partner capital accounts. c. The partners’ relative profit and loss sharing ratio. d.The partners’ relative share of the gain or loss on liquidation.