ump-Sum Liquidation hree university students, Cho, Kenney, and Martinez, operated a successful business, re raduating and wish to sell the business before beginning their respective careers. They Cash Receivables Loan receivable-Cho Rental equipment, net $6,000 Accounts payable 25,000 Loan payable-Kenney 15,000 | Capital-Cho 140,000 $60,000 10,000 27,000 Capital-Kenney 28,000 Capital-Martinez 61,000 Total assets $186,000 Total liabilities and capital $186,000 mother student group, organized as a corporation, wants to buy the business. Their offe aid and the partnership is liquidated. nquired
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- Accounting Make it ASAP Lump-Sum Liquidation Three university students, Cho, Kenney, and Martinez, operated a successful business, renting furniture and appliances to students residing in dormitories and off-campus apartments. The three are now graduating and wish to sell the business before beginning their respective careers. They shared profits in a 2:1:1 ratio. The partnership’s current balance sheet is as follows: Cash $6,000 Accounts payable $60,000 Loan receivable—Cho 25,000 Loan payable—Kenney 10,000 Other assets 158,000 Capital—Cho 30,000 Capital—Kenney 30,000 Capital—Martinez 59,000 Total assets $189,000 Total liabilities and capital $189,000 Another student group, organized as an LLC, wants to buy the business. The LLC's offer of $117,000 for the partnership's other assets is accepted. After receipt of the $117,000, the liabilities are paid and the partnership is liquidated. Required How much does each partner receive? Assume that if one…Part AThe partnership of Butler, Osman, and Ward was formed several years 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 $34,000 are expected. The partnership balance sheet at the start of liquidation is as follows: Cash . . . . . . . . . . . . . . . . . . . $ 30,000 Liabilities . . . . . . . . . . . . . . . $170,000Accounts receivable . . . . . 60,000 Butler, loan . . . . . . . . . . . .. . . . 30,000Office equipment (net) . . . . 50,000 Butler, capital (25%) . . . . . . . . . 50,000Building (net) . . . . . . . . . . . . 110,000 Osman, capital (25%) . . . . . . . . 30,000Land . . . . . . . . . . . . . . . . . . . 100,000 Ward, capital (50%) . . . . .. . . . . 70,000 Prepare a predistribution plan for this partnership.Part BThe following transactions transpire in chronological order during the liquidation of the partnership:1. Collected 90 percent of…Distribution of Cash Upon Liquidation Bray, Lincoln, and Mapes arranged to import and sell orchid corsages for a university dance. They agreed to share equally the net income or net loss of the venture. Bray and Lincoln advanced $780 and $1,200 of their own respective funds to pay for advertising and other expenses. After collecting for all sales and paying creditors, the partnership has $3,210 in cash. Use the minus sign to indicate any deficiency for the capital accounts. a. How much net income was earned from the venture?$fill in the blank 1 b. How should the $3,210 be distributed? Bray Lincoln Mapes Total Capital balances and cash distribution $fill in the blank 2 $fill in the blank 3 $fill in the blank 4 $fill in the blank 5 c. Assume that the partnership has only $1,710 instead of $3,210. Complete the following table to determine if any of the three partners have a capital deficiency? Bray Lincoln Mapes Total Capital balances $fill in the blank 6 $fill in the…
- 3. Brielle received $30,000 in cash and an automobile with an adjusted basis and market value of $20,000 in a proportionate liquidating distribution from the BD Partnership. Brielle's basis in the partntership interest was $60,000 before the distribution. What is Brielle's basis in the automobile received in the liquidation? A. $0 B. $10,000 C. $20,000 D. $30,000Hillary Bruce and Cindy own a partnership firm. Hillary has an ownership interest of $24,000, Bruce has an ownership interest of $41,000, and Cindy has an ownership interest of $30,000. In the process of liquidation, the partnership sells non cash assets and registers a gain of $30,000. The profit loss sharing agreement is 1:2:3 respectively. Which of the following is TRUE when a journal entry for the allocation of gain is recorded? A) Hillary Capital is credited for $10,000. B) Cindy, Capital Is credited for $15,000 C) Hillary capital is debited for $10,000. D) Cindy Capital is credited for $ 10,000A. The Abrams, Bartle, and Creighton partnership began the process of liquidation with thefollowing balance sheet: Cash $16,00 Non cash Assets $434,000 Liabilities $150,000 Abrams Capital $80,000 Bartle Capital $90,000 Creighton Capital $130,000 Abrams, Bartle, and Creighton share profits and losses in a ratio of 3:2:5. Liquidation expenses are expected to be $12,000.1. If the non-cash assets were sold for $234,000, what amount of the loss would have been allocated to Bartle?2. If the non-cash assets were sold for $134,000, which partner(s) would have had to contribute assets to the partnership to cover a deficit in his/her capital account?3. After the liquidation expenses of $12,000 were paid and the non-cash assets sold, Creighton had a deficit of $8,000. For what amount were the non-cash assets sold?
- The net equities and income-sharing ratio for the R, S, T U Partnership before liquidation were as follows: R S T U Net equity in partnership $36,000 $32,400 $8,000 $(100) Income-sharing ratio 3 4 2 1 A) Prepare a program showing how cash should be distributed if the liabilities are $15,000.B) Make the journal entry to distribute $90,000 cash.The balance sheet for the Delphine, Xavier, and Olivier partnership follows: Cash . . . . . . . . . . . . . . . . . . . $ 60,000 Liabilities . . . . . . . . . . . . . . . $ 40,000Noncash assets . . . . . . . . . 100,000 Delphine, capital . . . . . . . . .. 60,000Xavier, capital . . . . . . . . . . . 40,000Olivier, capital . . . . . . . . . . . 20,000 Delphine, Xavier, and Olivier share profits and losses in the ratio of 4:4:2, respectively. The partners have agreed to terminate the business and estimate that $12,000 in liquidation expenses will be incurred.a. What is the amount of cash that safely can be paid to partners prior to liquidation of noncash assets?b. How should the safe amount of cash determined in (a) be distributed to the partners?Profit Distribution. Almazar and Viray are partners in a business. Almazar's original capital contribution was P400,000 and Viray was P600,000. They agreed to share profits and losses as follows: Almazar Viray As Salaries P360,000 P480,000 As interest on original Capital 10% 10% Remaining profit or losses 2/3 1/3 Calculated each partner's share of profits and losses, assuming: a. Profit P700,000 b. Loss P35,000
- Withdrawal of a Partner Ventic was the senior member of the partnership of Ventic, Joson, and Daguiso. When Ventic died, the firm's accountant revalued the assets. The following assets are to be increased in value by these amounts: Merchandise Inventory, P280,000; Building, P560,000. The value of the asset, Equipment, is to be decreased by P90,000. Assuming that the partnership profit and loss ratio is 2:2:1, respectively, prepare the journal entry to record the revaluation of the assets on June 5 prior to dissolution of the firm.Cupcake and Sugar share profits and losses 1/3 and 6/9 respectively. Cupcake receives amonthly salary of P15,000. If Cupcake’s capital balance is P250,000 at the beginning of the year andP150,000 at the end of the year, and annual partnership income after salaries is P120,000, thenCupcake withdrew what is the answer and why?a.) P130,000 b.) P155,000 c.) P320,000 d.) P180,000Liability comparisons Nerissa Smith has invested $25,000 in Northeast Productions Company. The firm has recently declared bankruptcy and has $60,000 in unpaid debts. Explain the nature of Nerissa's personal liabilit , if any, in each of the following situations. a. Northeast Productions Company is a sole proprietorship owned by Ms. Smith. b. Northeast Productions Company is a 50-50 general partnership of Nerissa Smith and Roger Brown. c. Northeast Productions Company is a limited partnership where Nerissa Smith is a limited partner. d. Northeast Productions Company is a corporation. 1) If Northeast Productions Company is a 50-50 partnership of Nerissa Smith and Roger Brown,: (Select the best answer below.) A.Ms. Smith has unlimited liability, which means creditors can only claim against the $25,000 she invested. B.Ms. Smith has limited liability, which is $30,000, or half of the $60,000 in unpaid debts. C.Ms. Smith has unlimited liability, which means creditors…