The partnership of Hendrick, Mitchum, and Redding has the following account balances: Cash $ 51,000 Liabilities $ 41,000 Noncash assets 150,000 Hendrick, capital 119,000 Mitchum, capital 85,000 Redding, capital (44,000 ) This partnership is being liquidated. Hendrick and Mitchum are each entitled to 40 percent of all profits and losses with the remaining 20 percent going to Redding. What is the maximum amount that Redding might have to contribute to this partnership because of the deficit capital balance? How should the $10,000 cash that is presently available in excess of liabilities be distributed? If the noncash assets are sold for a total of $65,000, what is the minimum amount of cash that Hendrick could receive? (Do not round intermediate calculations.)
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is 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, drawings of a partner, etc.
The
| Cash | $ | 51,000 | Liabilities | $ | 41,000 | |||
| Noncash assets | 150,000 | Hendrick, capital | 119,000 | |||||
| Mitchum, capital | 85,000 | |||||||
| Redding, capital | (44,000 | ) | ||||||
This partnership is being liquidated. Hendrick and Mitchum are each entitled to 40 percent of all
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What is the maximum amount that Redding might have to contribute to this partnership because of the deficit capital balance?
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How should the $10,000 cash that is presently available in excess of liabilities be distributed?
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If the noncash assets are sold for a total of $65,000, what is the minimum amount of cash that Hendrick could receive? (Do not round intermediate calculations.)
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