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Partners A, B and C decided to liquidate their partnership. A summary of the partnership's statement of financial position is shown below: Cash 50,000 Noncash assets 1,200,000 Total 1,250,000 Accounts payable 100,000 Payable to A A, Capital (50%) B, Capital (30%) C, Capital (20%) 50,000 540,000 360,000 200,000 Total 1,250,000 If a cash priority program is prepared, which partner is paid first and how much is the total payments to that partner before all partners will share on the available cash based on their profit and loss ratios?

Partners A, B and C decided to liquidate their partnership. A summary of the partnership's statement of financial position is shown below: Cash 50,000 Noncash assets 1,200,000 Total 1,250,000 Accounts payable 100,000 Payable to A A, Capital (50%) B, Capital (30%) C, Capital (20%) 50,000 540,000 360,000 200,000 Total 1,250,000 If a cash priority program is prepared, which partner is paid first and how much is the total payments to that partner before all partners will share on the available cash based on their profit and loss ratios?

FINANCIAL ACCOUNTING
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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Partners A, B and C decided to liquidate their partnership. A summary of the partnership's statement of financial position is shown below: Cash 50,000 Noncash assets 1,200,000 Total 1,250,000 Accounts payable Payable to A A, Capital (50%) B, Capital (30%) C, Capital (20%) 100,000 50,000 540,000 360,000 200,000 Total 1,250,000 If a cash priority program is prepared, which partner is paid first and how much is the total payments to that partner before all partners will share on the available cash based on their profit and loss ratios?
Transcribed Image Text:Partners A, B and C decided to liquidate their partnership. A summary of the partnership's statement of financial position is shown below: Cash 50,000 Noncash assets 1,200,000 Total 1,250,000 Accounts payable Payable to A A, Capital (50%) B, Capital (30%) C, Capital (20%) 100,000 50,000 540,000 360,000 200,000 Total 1,250,000 If a cash priority program is prepared, which partner is paid first and how much is the total payments to that partner before all partners will share on the available cash based on their profit and loss ratios?
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