ADVANCED ACCT CUSTOM W/CONNECT
14th Edition
ISBN: 9781307697711
Author: Hoyle
Publisher: MCG/CREATE
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
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.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
es
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
147,500
Horvath
Markov
Petronis
Jose, Bonl and Tony are partners with a profit and loss ratio of 5:41 The partnership is to be liquidated. Prior to the liquidation process, the Statement of Financial Position shows the following balances: Cash-P 20,000; Other assets-P 180,000; Liabilities-P 20.000; Jose, Capital - P80,000; Boni, Capital-P 60,000: Tony, Capital-P40,000. After realization. Boni received P 32,000 as settlement of his interest. How much is the total loss on realization?
In the settlement to partners, how much did Tony receive?
Chapter 15 Solutions
ADVANCED ACCT CUSTOM W/CONNECT
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
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after Tatum receives a 10,000 salary and Brook receives a 15,000 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $40,000 B. $25,000 C. ($5,000) In addition, show the resulting entries to each partners capital account. Tatums capital account balance is $50,000 and Brooks is $60,000.arrow_forwardThe partnership of Magda and Sue shares profits and losses in a 50:50 ratio after Mary receives a $7,000 salary and Sue receives a $6,500 salary. Prepare a schedule showing how the profit and loss should be divided, assuming the profit or loss for the year is: A. $10,000 B. $5,000 C. ($12,000) In addition, show the resulting entries to each partners capital account.arrow_forwardA 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%) . . . . . . . $59,000Michael, capital (30%) . . . . . . 39,000Brendan, capital (10%) . . . . . . 34,000Jonathan, 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? Choose the correct.a. $12,250b. $14,750c. $17,000d. $19,500arrow_forward
- A partnership has the following balance sheet prior to liquidation (partners’ profit and loss ratios are in parentheses): During liquidation, other assets are sold for $80,000, liabilities are paid in full, and $15,000 in liquidation expenses are paid. What amount of cash does each partner receive as a result of this liquidation? Playa, $6,000; Bahia, $4,500; Arco, $4,500. Playa, $10,000; Bahia, $18,500; Arco, $19,500. Playa, $16,000; Bahia, $23,000; Arco, $24,000. Playa, $19,200; Bahia, $14,400; Arco, $14,400.arrow_forwardA 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. $19,500arrow_forwardA 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: 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? $12,250 $12,250 $17,000 $19,500arrow_forward
- D, E, and F are partners with a profit and loss ratio of 5:4:1, respectively. The partnership is to be liquidated. Prior to the liquidation, the statement of financial position shows the following balances Cash P 80,000 Liabilities P 80,000 Other Assets 720,000 D, Capital 320,000 E, Capital 240,000 F, Capital 160,000 After realization, E received P 120,000 as settlement of his interest. How much was the loss on the sale of assets? How much did F receive in final settlement of his interest? What amount of total cash was distributed to the Partners?arrow_forwardA Statement of Financial Position for the partnership of John, Paul and Ryan, who share profits in the ratio of 2:1:1, shows the following balances just before liquidation: Assets Cash Other assets Liabilities and Equity Liabilities 240,000 P 144,000 714,000 John, capital 264,000 186,000 Paul, capital Ryan, capital 168,000 In the first month of liquidation, certain assets are sold for P384,000. Liquidation expenses of P12,000 are paid, and additional expenses are anticipated. Liabilities of P64,800 are paid and sufficient cash is retained for the anticipated liquidation expenses. In the first payment to partners, John receives P60,000. How much is the theoretical losses in the first month of liquidation? Parrow_forwardA partnership is currently holding $200,000 in assets and $120,000 in liabilities. The partnership is to be liquidated, and $20,000 is the best estimation of the expenses that will be incurred during the process. The capital balances of the two partners at the start of the liquidation and the profit and loss ratios are shown below. Kevin, Capital (40% of gains and losses)……………………………….…....$20,000 Michael, Capital (60% of gains and losses)………………………………….$60,000 The partners realize that Michael will be the first partner to start receiving cash. How much cash will Michael receive before Kevin collects any cash?arrow_forward
- Kendra, Cogley, and Mel share Income and loss in a 3:2:1 ratio (in ratio form: Kendra, 3/6; Cogley, 2/6; and Mel, 1/6). The partners have decided to liquidate their partnership. On the day of liquidation, their balance sheet appears as follows. Balance Sheet Accounts payable Kendra, Capital Cogley, Capital Mei, Capital $631,000 Total liabilities and equity Cash Inventory Assets Total assets $ 89,200 541,800 Required 1 Inventory Required: For each of the following scenarios, complete the schedule allocating the gain or loss on the sale of Inventory. Prepare journal entries to record the below transactions. (Do not round Intermediate calculations. Enter losses and partner deficits, if any, as negative amounts.) 1 2 1. Inventory is sold for $604,200. 2. Inventory is sold for $424,200. 3. Inventory is sold for $307,800 and partners with deficits pay their deficits in cash. 4. Inventory is sold for $262,200 and partners with deficits do not pay their deficits. Required 2 Inventory Required…arrow_forwardA balance sheet for the partnership of A, B, and C, who share profits 2:1:1, shows the following balances just before liquidation: Cash: P48,000Other assets: 238,000Liabilities: 80,000A, Capital: 88,000B, Capital: 62,000C, Capital: 56,000 On the first month of liquidation, certain non-cash assets were sold resulting to a loss of P23,000. Liquidation expenses of P4,000 were paid, and additional liquidation expenses of P3,200 are withheld to anticipate payment before liquidation is completed. After creditors were paid, partner B received P13,000 on the initial installment. Determine the total book value of the non-cash assets on the first month.arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
College Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
College Accounting, Chapters 1-27
Accounting
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:Cengage Learning,
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College