Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are Chen, capital Korhonen, capital Lebuca, capital Swid, capital $ 67,000 29,100 50,000 22,100 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.

Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are Chen, capital Korhonen, capital Lebuca, capital Swid, capital $ 67,000 29,100 50,000 22,100 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.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are
beginning to liquidate the business. At the start of this process, capital balances are
Chen, capital
Korhonen, capital
Lebuca, capital
Swid, capital
$ 67,000
29,100
50,000
22,100
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
$
Chen
Korhonen
67,000 $
29,100 $
Lebuca
50,000 $
Swid
22,100

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Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are Chen, capital Korhonen, capital Lebuca, capital Swid, capital Required: $ 68,000 29,400 51,000 22,400 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 Chen Korhonen Lebuca Swid $ 68,000 $ 29,400 $ 51,000 $ 22,400