Advanced Accounting 14th Edition
14th Edition
ISBN: 9781260726442
Author: By Joe Ben Hoyle And Thomas Schaefer And Timothy Doupnik
Publisher: Mc Grawhill Education
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Chapter 15, Problem 4Q
To determine
Describe the basis for allocating remaining cash among the partners after liquidating all property and paying
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One of the final steps in terminating a partnership is the distribution of remaining assets to the partners after all obligations have been met. What is the basis for distributing any remaining assets/cash among the partners? How would loans from partners affect the distribution of partnership assets?
After all partnership assets have been converted to cash and all liabilities paid, the remaining cash should equal the sum of the balances of the partners’ capital accounts. Why?
What value should be assigned to non-cash assets transferred by one of the partners to the partnership?
Chapter 15 Solutions
Advanced Accounting 14th Edition
Ch. 15 - Prob. 1QCh. 15 - Prob. 2QCh. 15 - Prob. 3QCh. 15 - Prob. 4QCh. 15 - What is the purpose of a statement of liquidation?...Ch. 15 - Prob. 1PCh. 15 - Prob. 2PCh. 15 - Prob. 3PCh. 15 - Prob. 4PCh. 15 - A partnership is considering possible liquidation...
Ch. 15 - What is a predistribution plan? a. A list of the...Ch. 15 - Prob. 7PCh. 15 - Prob. 8PCh. 15 - Prob. 9PCh. 15 - Prob. 10PCh. 15 - Prob. 11PCh. 15 - Prob. 12PCh. 15 - Prob. 13PCh. 15 - Prob. 14PCh. 15 - Prob. 15PCh. 15 - Prob. 16PCh. 15 - Prob. 17PCh. 15 - Prob. 18PCh. 15 - Prob. 25PCh. 15 - Prob. 26PCh. 15 - March, April, and May have been in partnership for...Ch. 15 - Prob. 28PCh. 15 - Prob. 29P
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- When a partnership is liquidated, any gains or losses realized by the sale of noncash assets are allocated to the partners based on their income sharing ratio. Why?arrow_forwardWhen a partnership liquidates, do partners get paid first or do creditors get paid first?arrow_forwardWhen a partnership dissolves, the first step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partnersarrow_forward
- When a partnership dissolves, the last step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partnersarrow_forwardIn a partnership liquidation, the final cash distribution to the partners should be made in accordance with the?arrow_forwardIn partnership liquidation, the final cash distribution to the partners should be made in accordance with the: a. Partners’ profit and loss sharing ratio b. Balances of the partner’s capital account c. Ratio of the capital contributions by the partners d. Ratio of capital contributions less withdrawals by the partnersarrow_forward
- After C’s admission, the partners agreed to adjust their capital balances to reflect their’ respective interests in the partnership’s net assets. Cash settlement is to be made between the partners. How much is the cash settlement?arrow_forwardIn a partnership liquidation, the final cash distribution to the partners should be made in accordance with the... A.) Safe payments computations. B.) Partners' profit and loss sharing ratios. C.) Balances of partners' capital accounts. D.) Ratio of the capital contributions by partners.arrow_forwardWhat is a predistribution plan? Choose the correct.a. A list of the procedures to be performed during a liquidation.b. A guide for the cash distributions to partners during a liquidation.c. A determination of the final cash distribution to the partners on the settlement date.d. A detailed list of the transactions that will transpire in the reorganization of a partnership.arrow_forward
- Choose the correct. If a partnership is liquidated, how is the final allocation of business assets made to the partners?a. Equally.b. According to the profit and loss ratio.c. According to the final capital account balances.d. According to the initial investment made by each of the partners.arrow_forwardWhat valuation should be recorded for noncash assets transferred to a partnership by one of the partners?arrow_forwardHow are safe capital balances computed when preliminary distributions of cash are to be made in a partnership liquidation?arrow_forward
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