The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners have reached retirement age, and the partners have decided to terminate operations and liquidate the business. Liquidation expenses of $50,000 are expected. The partnership balance sheet at the start of liquidation is as follows: Cash $ 46,000 Liabilities $ 186,000 Accounts receivable 76,000 Butler, loan 46,000 Office equipment (net) 66,000 Butler, capital (25%) 130,000 Building (net) 190,000 Osman, capital (25%) 46,000 Land 180,000 Ward, capital (50%) 150,000 Total assets $ 558,000 Total liabilities and capital $ 558,000 Prepare a predistribution plan for this partnership.
The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners have reached retirement age, and the partners have decided to terminate operations and liquidate the business. Liquidation expenses of $50,000 are expected. The partnership balance sheet at the start of liquidation is as follows: Cash $ 46,000 Liabilities $ 186,000 Accounts receivable 76,000 Butler, loan 46,000 Office equipment (net) 66,000 Butler, capital (25%) 130,000 Building (net) 190,000 Osman, capital (25%) 46,000 Land 180,000 Ward, capital (50%) 150,000 Total assets $ 558,000 Total liabilities and capital $ 558,000 Prepare a predistribution plan for this partnership.
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter14: Partnerships And Limited Liability Entities
Section: Chapter Questions
Problem 24P
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The
| Cash | $ | 46,000 | Liabilities | $ | 186,000 | ||
| 76,000 | Butler, loan | 46,000 | |||||
| Office equipment (net) | 66,000 | Butler, capital (25%) | 130,000 | ||||
| Building (net) | 190,000 | Osman, capital (25%) | 46,000 | ||||
| Land | 180,000 | Ward, capital (50%) | 150,000 | ||||
| Total assets | $ | 558,000 | Total liabilities and capital | $ | 558,000 | ||
Prepare a predistribution plan for this partnership.
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