Partners A, B, C, and D have been operating ABCD Partnership for ten years. Due to a significant reduction in the demand for their product over recent years, the partners have agreed to liquidate the partnership. At the time of liquidation, balance sheet accounts consisted of cash, P103,500; noncash assets, P300,000; liabilities to outsiders, P60,000; capital credit balances for partners A, B, and C, P90,000, P150,000, and P120,000, respectively; and a debit capital balance for partner D of P16,500. Partners share equally in income and loss. It is estimated that the administrative cost of liquidation will total P4,500. While preparing for liquidation, an unrecorded liability of P7,500 was discovered. Required: For how much must the noncash assets be sold for partner D to received at least P5,000?
Partners A, B, C, and D have been operating ABCD Partnership for ten years. Due to a significant reduction in the demand for their product over recent years, the partners have agreed to liquidate the partnership. At the time of liquidation, balance sheet accounts consisted of cash, P103,500; noncash assets, P300,000; liabilities to outsiders, P60,000; capital credit balances for partners A, B, and C, P90,000, P150,000, and P120,000, respectively; and a debit capital balance for partner D of P16,500. Partners share equally in income and loss. It is estimated that the administrative cost of liquidation will total P4,500. While preparing for liquidation, an unrecorded liability of P7,500 was discovered. Required: For how much must the noncash assets be sold for partner D to received at least P5,000?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Partners A, B, C, and D have been operating ABCD Partnership for
ten years. Due to a significant reduction in the demand for their
product over recent years, the partners have agreed to liquidate the
partnership. At the time of liquidation, balance sheet accounts
consisted of cash, P103,500; noncash assets, P300,000; liabilities to
outsiders, P60,000; capital credit balances for partners A, B, and C,
P90,000, P150,000, and P120,000, respectively; and a debit capital
balance for partner D of P16,500. Partners share equally in income
and loss. It is estimated that the administrative cost of liquidation will
total P4,500. While preparing for liquidation, an unrecorded liability
of P7,500 was discovered.
Required: For how much must the noncash assets be sold for partner
D to received at least P5,000?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education