A, B and C, partners to a firm, have capital balances of P51,000, P26,000, and P12,000, respectively, and share profits in the ratio of 4:2:1. If the partnership will be liquidated, who among the partners shall be paid first? a. A b. B c. C d. Cannot be determined
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
A, B and C, partners to a firm, have capital balances of P51,000, P26,000, and P12,000, respectively, and share
profits in the ratio of 4:2:1. If the partnership will be liquidated, who among the partners shall be paid first?
a. A
b. B
c. C
d. Cannot be determined
Step by step
Solved in 2 steps
