A balance sheet for the QRS Partnership, which shares profits and losses in the ratio of 5:3:2 shows the following balances just before liquidation: Cash, 30,000; Other assets, 148,750; Liabilities, 50,000; Q, Capital, 55,000; R, Capital, 38,750; S Capital, 35,000. On the first month of liquidation, certain assets are sold for 80,000. Liquidation expenses of 2,500 is paid, and additional expenses are anticipated. Liabilities are paid amounting to 13,500, and sufficient cash is retained to ensure payment to creditors before making payment to partners. On the payments to partners, Q receives 15,625. Calculate the amount of cash withheld for anticipated liquidation expenses.
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
Cash, 30,000;
Other assets, 148,750;
Liabilities, 50,000;
Q, Capital, 55,000;
R, Capital, 38,750;
S Capital, 35,000.
On the first month of liquidation, certain assets are sold for 80,000. Liquidation expenses of 2,500 is paid, and additional expenses are anticipated. Liabilities are paid amounting to 13,500, and sufficient cash is retained to ensure payment to creditors before making payment to partners. On the payments to partners, Q receives 15,625.
Calculate the amount of cash withheld for anticipated liquidation expenses.
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