Answered: Alpha, Beta, and Gamma are partners who…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter14: Choice Of Business Entity—operations And Distributions

Section: Chapter Questions

Problem 47P

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Alpha, Beta, and Gamma are partners who have capital balances of P480,000, P500,000 and p180,000 respectively. P/L is distributed in the ratio of 4:2:1. Beta received P260,000 as a result of liquidating the partnership when 60% of the noncash assets of the partnership is realized. The partnership has total assets totaling P500,000 including P50,000 cash before liquidation. The partnership also incurred P35,000 liquidation expenses and withheld P28,000 for the unpaid liabilities of the partnership. What is the loss on realization of noncash assets?

a. 632,000
b. 875,000
c. 855,000
d. 612,000

Please provide a good accounting form for the solution

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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