A local partnership is to be liquidated. Commissions and other liquidation expenses are expected to total $19,000. The business’s balances prior to the commencement of liquidation is as follows: Cash . . . . . . . . . . . . . . . . . . . $ 27,000 Liabilities . . . . . . . . . . . . . . . $ 40,000Noncash assets . . . . . . . . . 254,000 Simpson, capital (20%) . . . 18,000Hart, capital (40%) . . . . . .. . 40,000Bobb, capital (20%) . . . . . . . 48,000Reidl, capital (20%) . . . . . . . 135,000 Prepare a predistribution plan for this partnership.
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 local
Cash . . . . . . . . . . . . . . . . . . . $ 27,000 Liabilities . . . . . . . . . . . . . . . $ 40,000
Noncash assets . . . . . . . . . 254,000 Simpson, capital (20%) . . . 18,000
Hart, capital (40%) . . . . . .. . 40,000
Bobb, capital (20%) . . . . . . . 48,000
Reidl, capital (20%) . . . . . . . 135,000
Prepare a predistribution plan for this partnership.
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