Turner, Roth, and Lowe are partners who share income and loss in a 1:4:5 ratio (in percents: Turner, 10%; Roth, 40%; and Lowe, 50%). The partners decide to liquidate the partnership. Immediately before liquidation, the partnership balance sheet shows total assets, $126,000; total liabilities, $78,000; Turner, Capital, $2,500; Roth, Capital, $14,000; and Lowe, Capital, $31,500. Cash received from selling the assets was sufficient to repay all but $28,000 to the creditors. a. Calculate the loss from selling the assets. b. Allocate the loss from part (a) to the partners. c. Determine how much each partner should contribute to the partnership to cover any remaining capital deficiency.
Turner, Roth, and Lowe are partners who share income and loss in a 1:4:5 ratio (in percents: Turner, 10%;
Roth, 40%; and Lowe, 50%). The partners decide to liquidate the
the partnership
$2,500; Roth, Capital, $14,000; and Lowe, Capital, $31,500. Cash received from selling the assets was
sufficient to repay all but $28,000 to the creditors.
a. Calculate the loss from selling the assets.
b. Allocate the loss from part (a) to the partners.
c. Determine how much each partner should contribute to the partnership to cover any remaining capital
deficiency.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
