Hillary Ricketts has been a partner in Mandrake’s Tobacconists (“the Firm”) for the pastseven years. The Firm itself has been in existence for over a hundred years and has a loyal customer base both in the West Bromwich and via its internet ordering service. Unfortunately, in recent years, primarily due to the smoking ban in public places, the Firm’s turnover has reduced significantly. It has continued to trade profitably but not as successfully as before. Just prior to Christmas the Firm suffered a tragic blow with the death of Stanley Findlay who hadbeen a partner in the firm for over 40 years. Stanley’s knowledge of Cuban cigars was second to no- one in the UK and his loss is greatly felt. Stanley’s widow, Agnes, has inherited all of Stanley’sproperty under his will.In addition to Hillary Ricketts and Stanley Findlay, the Firm has a third partner Praveen Kumar.Praveen Kumar and Hillary Ricketts have continued to operate the business since Stanley Findlays death although now it has beendecided to wind up the Firm. Praveen Kumar and Hillary Ricketts have had a number of disagreements. The latest disagreement was over an order that Praveen Kumar made for three Spurion Delta Lap Top Computers (total cost £3,699) from Universal Computers Limited on 15th December last year.The computers were ordered on the Firm’s headed notepaper which lists as partners Stanley Findlay, Praveen Kumar and Hillary Ricketts. The computers were delivered to the Firm’s address. Hillary Ricketts was unaware of the order and has never seen the computers. Praveen Kumar is always very evasive about them when Hillary Ricketts raises the matter with him. Hillary Ricketts has received a letter from the Firm’s accountants setting out the approximate assets and liabilities of the Firm. The Firm’s assets are valued at £270,000. The amount owed to the Firm’s bank Tanta Bank Plc is £12,600 and trade creditors are owed £5,332. It appears that the partnership agreement does not make provision for distribution of assets on dissolution of the partnership. It does provide that profits and losses are to be shared equally between the partners. The partners’ capital accounts show the capital contributions of the partners are as follows: Stanley Findlay £20,000, Praveen Kumar £10,000 and Hillary Ricketts £20,000. Hillary Ricketts 5 requires a clear explanation of how much money he, Praveen Kumar and Agnes are likely to receive once the winding up is completed.In addition to the balance on the partners’ capital accounts, Praveen Kumar advanced to the Firm thesum of £6,000 by way of interest free loan. (i) Hillary Ricketts needs advice as to whether or not the Firm is liable to pay for the computers and if sowhether all the partners will be equally liable.(ii) Based on the figures above (assume for these purposes that the Firm is not liable to pay for thecomputers) how much money will Hillary Ricketts, Praveen Kumar and Agnes each be entitled to on the winding up of the Firm?
Hillary Ricketts has been a partner in Mandrake’s Tobacconists (“the Firm”) for the pastseven years. The Firm itself has been in existence for over a hundred years and has a loyal customer base both in the West Bromwich and via its internet ordering service. Unfortunately, in recent years, primarily due to the smoking ban in public places, the Firm’s turnover has reduced significantly. It has continued to trade profitably but not as successfully as before. Just prior to Christmas the Firm suffered a tragic blow with the death of Stanley Findlay who hadbeen a partner in the firm for over 40 years. Stanley’s knowledge of Cuban cigars was second to no- one in the UK and his loss is greatly felt. Stanley’s widow, Agnes, has inherited all of Stanley’sproperty under his will.In addition to Hillary Ricketts and Stanley Findlay, the Firm has a third partner Praveen Kumar.Praveen Kumar and Hillary Ricketts have continued to operate the business since Stanley Findlays death although now it has beendecided to wind up the Firm. Praveen Kumar and Hillary Ricketts have had a number of disagreements. The latest disagreement was over an order that Praveen Kumar made for three Spurion Delta Lap Top Computers (total cost £3,699) from Universal Computers Limited on 15th December last year.The computers were ordered on the Firm’s headed notepaper which lists as partners Stanley Findlay, Praveen Kumar and Hillary Ricketts. The computers were delivered to the Firm’s address. Hillary Ricketts was unaware of the order and has never seen the computers. Praveen Kumar is always very evasive about them when Hillary Ricketts raises the matter with him. Hillary Ricketts has received a letter from the Firm’s accountants setting out the approximate assets and liabilities of the Firm. The Firm’s assets are valued at £270,000. The amount owed to the Firm’s bank Tanta Bank Plc is £12,600 and trade creditors are owed £5,332. It appears that the partnership agreement does not make provision for distribution of assets on dissolution of the partnership. It does provide that profits and losses are to be shared equally between the partners. The partners’ capital accounts show the capital contributions of the partners are as follows: Stanley Findlay £20,000, Praveen Kumar £10,000 and Hillary Ricketts £20,000. Hillary Ricketts 5 requires a clear explanation of how much money he, Praveen Kumar and Agnes are likely to receive once the winding up is completed.In addition to the balance on the partners’ capital accounts, Praveen Kumar advanced to the Firm thesum of £6,000 by way of interest free loan. (i) Hillary Ricketts needs advice as to whether or not the Firm is liable to pay for the computers and if sowhether all the partners will be equally liable.(ii) Based on the figures above (assume for these purposes that the Firm is not liable to pay for thecomputers) how much money will Hillary Ricketts, Praveen Kumar and Agnes each be entitled to on the winding up of the Firm?
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Hillary Ricketts has been a partner in Mandrake’s Tobacconists (“the Firm”) for the past
seven years. The Firm itself has been in existence for over a hundred years and has a loyal customer base both in the West Bromwich and via its internet ordering service. Unfortunately, in recent years, primarily due to the smoking ban in public places, the Firm’s turnover has reduced significantly. It has continued to trade profitably but not as successfully as before. Just prior to Christmas the Firm suffered a tragic blow with the death of Stanley Findlay who had
been a partner in the firm for over 40 years. Stanley’s knowledge of Cuban cigars was second to no- one in the UK and his loss is greatly felt. Stanley’s widow, Agnes, has inherited all of Stanley’s
property under his will.
In addition to Hillary Ricketts and Stanley Findlay, the Firm has a third partner Praveen Kumar.
Praveen Kumar and Hillary Ricketts have continued to operate the business since Stanley Findlays death although now it has been
decided to wind up the Firm. Praveen Kumar and Hillary Ricketts have had a number of disagreements. The latest disagreement was over an order that Praveen Kumar made for three Spurion Delta Lap Top Computers (total cost £3,699) from Universal Computers Limited on 15th December last year.
The computers were ordered on the Firm’s headed notepaper which lists as partners Stanley Findlay, Praveen Kumar and Hillary Ricketts. The computers were delivered to the Firm’s address. Hillary Ricketts was unaware of the order and has never seen the computers. Praveen Kumar is always very evasive about them when Hillary Ricketts raises the matter with him. Hillary Ricketts has received a letter from the Firm’s accountants setting out the approximate assets and liabilities of the Firm. The Firm’s assets are valued at £270,000. The amount owed to the Firm’s bank Tanta Bank Plc is £12,600 and trade creditors are owed £5,332. It appears that the partnership agreement does not make provision for distribution of assets on dissolution of the partnership. It does provide that profits and losses are to be shared equally between the partners. The partners’ capital accounts show the capital contributions of the partners are as follows: Stanley Findlay £20,000, Praveen Kumar £10,000 and Hillary Ricketts £20,000. Hillary Ricketts 5 requires a clear explanation of how much money he, Praveen Kumar and Agnes are likely to receive once the winding up is completed.In addition to the balance on the partners’ capital accounts, Praveen Kumar advanced to the Firm thesum of £6,000 by way of interest free loan.
seven years. The Firm itself has been in existence for over a hundred years and has a loyal customer base both in the West Bromwich and via its internet ordering service. Unfortunately, in recent years, primarily due to the smoking ban in public places, the Firm’s turnover has reduced significantly. It has continued to trade profitably but not as successfully as before. Just prior to Christmas the Firm suffered a tragic blow with the death of Stanley Findlay who had
been a partner in the firm for over 40 years. Stanley’s knowledge of Cuban cigars was second to no- one in the UK and his loss is greatly felt. Stanley’s widow, Agnes, has inherited all of Stanley’s
property under his will.
In addition to Hillary Ricketts and Stanley Findlay, the Firm has a third partner Praveen Kumar.
Praveen Kumar and Hillary Ricketts have continued to operate the business since Stanley Findlays death although now it has been
decided to wind up the Firm. Praveen Kumar and Hillary Ricketts have had a number of disagreements. The latest disagreement was over an order that Praveen Kumar made for three Spurion Delta Lap Top Computers (total cost £3,699) from Universal Computers Limited on 15th December last year.
The computers were ordered on the Firm’s headed notepaper which lists as partners Stanley Findlay, Praveen Kumar and Hillary Ricketts. The computers were delivered to the Firm’s address. Hillary Ricketts was unaware of the order and has never seen the computers. Praveen Kumar is always very evasive about them when Hillary Ricketts raises the matter with him. Hillary Ricketts has received a letter from the Firm’s accountants setting out the approximate assets and liabilities of the Firm. The Firm’s assets are valued at £270,000. The amount owed to the Firm’s bank Tanta Bank Plc is £12,600 and trade creditors are owed £5,332. It appears that the partnership agreement does not make provision for distribution of assets on dissolution of the partnership. It does provide that profits and losses are to be shared equally between the partners. The partners’ capital accounts show the capital contributions of the partners are as follows: Stanley Findlay £20,000, Praveen Kumar £10,000 and Hillary Ricketts £20,000. Hillary Ricketts 5 requires a clear explanation of how much money he, Praveen Kumar and Agnes are likely to receive once the winding up is completed.In addition to the balance on the partners’ capital accounts, Praveen Kumar advanced to the Firm thesum of £6,000 by way of interest free loan.
(i) Hillary Ricketts needs advice as to whether or not the Firm is liable to pay for the computers and if sowhether all the partners will be equally liable.
(ii) Based on the figures above (assume for these purposes that the Firm is not liable to pay for thecomputers) how much money will Hillary Ricketts, Praveen Kumar and Agnes each be entitled to on the winding up of the Firm?
(ii) Based on the figures above (assume for these purposes that the Firm is not liable to pay for thecomputers) how much money will Hillary Ricketts, Praveen Kumar and Agnes each be entitled to on the winding up of the Firm?
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