ADVANCED ACCOUNTING
14th Edition
ISBN: 9781307664089
Author: Hoyle
Publisher: MCG/CREATE
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Chapter 15, Problem 9P
To determine
Identify the correct option for the amount of cash that person B will receive before any of the other partners collect any cash.
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A partnership is currently holding $400,000 in assets and $234,000 in liabilities. The partnership is to be liquidated, and $20,000 is
the best estimation of the expenses that will be incurred during this process. The four partners share profits and losses as shown.
Capital balances at the start of the liquidation follow:
Berzina, capital (40%)
Horvath, capital (30%)
Markov, capital (10%)
Petronis, capital (20%)
$ 59,000
39,000
34,000
34,000
Required:
Prepare a predistribution plan to determine which partner will be the first to receive cash from the liquidation and what amount that
partner will receive before other partners receive any cash.
Note: Amounts to be deducted should be entered with a minus sign.
Beginning balances
Assumed loss
Balances
Assumed loss
Balances
Assumed loss
Balances
$
$
$
$
$
Berzina
59,000 $
59,000 $
59,000 $
(7,000)
52,000 $
Horvath
39,000 $
39,000 $
39,000 $
39,000 $
Markov
34,000 $
(17,000)
17,000 $
(2,250)
14,750 $
(1,750)
13,000 $
Petronis
34,000…
A partnership is currently holding $400,000 in assets and $234,000 in liabilities. The partnership is to be liquidated, and $20,000 is
the best estimation of the expenses that will be incurred during this process. The four partners share profits and losses as shown.
Capital balances at the start of the liquidation follow:
Berzina, capital (40%)
Horvath, capital (30%)
Markov, capital (10%)
Petronis, capital (20%)
$ 59,000
39,000
34,000
34,000
Required:
Prepare a predistribution plan to determine which partner will be the first to receive cash from the liquidation and what amount that
partner will receive before other partners receive any cash.
Note: Amounts to be deducted should be entered with a minus sign.
Beginning balances
Assumed loss
Balances
Assumed loss
Balances
Assumed loss
Balances
$
Berzina
59,000 $
Horvath
39,000 $
Markov
34,000
$
Petronis
34,000
A partnership is currently holding $400,000 in assets and $234,000 in liabilities. The partnership is to be liquidated, and $20,000 is the best estimation of the expenses that will be incurred during this process. The four partners share profits and losses as shown. Capital balances at the start of the liquidation follow:
Kevin, capital (40%)
$59,000
Michael, capital (30%)
39,000
Brendan, capital (10%)
34,000
Jonathan, capital ( 20%)
34,000
The partners realize that Brendan will be the first partner to start receiving cash. How much cash will Brendan receive before any of the other partners collect any cash?
a. $17,000.b. $14,750.c. $12,250.d. $19,500
Chapter 15 Solutions
ADVANCED ACCOUNTING
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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