Nory and Oscar started a partnership some years ago and managed to operate profitably for several years. Recently, however, they lost a substantial legal suit and incurred unexpected losses on accounts receivable and inventories. As a result they decided to liquidate. They sold all assets and only P18,000 was available to pay liabilities, which amounted to P33,000. Their capital account balances before the state of liquidation and their profit sharing ratios are shown below: Capital balances P23,000 Profit sharing ratio Nory 60% Oscar P13,500 40% Nory is personally insolvent after paying the unpaid creditors, but Oscar has personal assets in excess of P100,000. In the settlement of partners, how much cash should Nory receive?

Nory and Oscar started a partnership some years ago and managed to operate profitably for several years. Recently, however, they lost a substantial legal suit and incurred unexpected losses on accounts receivable and inventories. As a result they decided to liquidate. They sold all assets and only P18,000 was available to pay liabilities, which amounted to P33,000. Their capital account balances before the state of liquidation and their profit sharing ratios are shown below: Capital balances P23,000 Profit sharing ratio Nory 60% Oscar P13,500 40% Nory is personally insolvent after paying the unpaid creditors, but Oscar has personal assets in excess of P100,000. In the settlement of partners, how much cash should Nory receive?

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter18: Comparative Forms Of Doing Business

Section: Chapter Questions

Problem 34P

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