A partnership is considering possible liquidation because one of the partners (Bell) is personally insolvent. Profits and losses are divided on a 4:3:2:1 basis, respectively. Capital balances at the current time are Bell, capital $ 106,000 Hardy, capital 91,000 Dennard, capital 12,000 Suddath, capital 102,000 Bell’s creditors have filed a $43,000 claim against the partnership’s assets. The partnership currently holds assets of $520,000 and liabilities of $209,000. An independent appraiser indicates that the assets can be sold for $300,000. Required: Prepare a statement of partnership liquidation to determine the amount of cash that Bell would receive from the sale of partnership assets. Note: Amounts to be deducted should be entered with a minus sign
A partnership is considering possible liquidation because one of the partners (Bell) is personally insolvent. Profits and losses are divided on a 4:3:2:1 basis, respectively. Capital balances at the current time are Bell, capital $ 106,000 Hardy, capital 91,000 Dennard, capital 12,000 Suddath, capital 102,000 Bell’s creditors have filed a $43,000 claim against the partnership’s assets. The partnership currently holds assets of $520,000 and liabilities of $209,000. An independent appraiser indicates that the assets can be sold for $300,000. Required: Prepare a statement of partnership liquidation to determine the amount of cash that Bell would receive from the sale of partnership assets. Note: Amounts to be deducted should be entered with a minus sign
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A
| Bell, capital | $ 106,000 |
|---|---|
| Hardy, capital | 91,000 |
| Dennard, capital | 12,000 |
| Suddath, capital | 102,000 |
Bell’s creditors have filed a $43,000 claim against the partnership’s assets. The partnership currently holds assets of $520,000 and liabilities of $209,000. An independent appraiser indicates that the assets can be sold for $300,000.
Required:
Prepare a statement of partnership liquidation to determine the amount of cash that Bell would receive from the sale of partnership assets.
Note: Amounts to be deducted should be entered with a minus sign
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