The assets and equities of the NSW Partnership at the end of its fiscal year, October 31, 2020, are as follows: Profit and loss agreement is 30:50:20. Cash P 150,000 Accounts receivable -net 200,000 Inventory 400,000 Plant Assets - net 700,000 Loan to South 50,000 Liabilities P 500,000 West, Loan 100,000 North, Capital 450,000 South, Capital 300,000 West, Capital 150,000 The partners decide to liquidate the partnership. They estimate that the non-cash assets other than the loan to South can be realized into P 1,000,000 over the two-month period ending December 31, 2020. Cash is to be distributed to the appropriate parties as it becomes available during the liquidation process. Required: a) Assuming that P 650,000 is available for the first distribution, show how the available cash would be distributed. b) Assuming that a total amount of P 75,000 is available for distribution to partners after liabilities to outside creditors have been paid, show how the cash will be distributed to the partners.
The assets and equities of the NSW Partnership at the end of its fiscal year, October 31, 2020, are as follows: Profit and loss agreement is 30:50:20. Cash P 150,000 Accounts receivable -net 200,000 Inventory 400,000 Plant Assets - net 700,000 Loan to South 50,000 Liabilities P 500,000 West, Loan 100,000 North, Capital 450,000 South, Capital 300,000 West, Capital 150,000 The partners decide to liquidate the partnership. They estimate that the non-cash assets other than the loan to South can be realized into P 1,000,000 over the two-month period ending December 31, 2020. Cash is to be distributed to the appropriate parties as it becomes available during the liquidation process. Required: a) Assuming that P 650,000 is available for the first distribution, show how the available cash would be distributed. b) Assuming that a total amount of P 75,000 is available for distribution to partners after liabilities to outside creditors have been paid, show how the cash will be distributed to the partners.
The assets and equities of the NSW Partnership at the end of its fiscal year, October 31, 2020, are as follows: Profit and loss agreement is 30:50:20. Cash P 150,000 Accounts receivable -net 200,000 Inventory 400,000 Plant Assets - net 700,000 Loan to South 50,000 Liabilities P 500,000 West, Loan 100,000 North, Capital 450,000 South, Capital 300,000 West, Capital 150,000 The partners decide to liquidate the partnership. They estimate that the non-cash assets other than the loan to South can be realized into P 1,000,000 over the two-month period ending December 31, 2020. Cash is to be distributed to the appropriate parties as it becomes available during the liquidation process. Required: a) Assuming that P 650,000 is available for the first distribution, show how the available cash would be distributed. b) Assuming that a total amount of P 75,000 is available for distribution to partners after liabilities to outside creditors have been paid, show how the cash will be distributed to the partners.
The assets and equities of the NSW Partnership at the end of its fiscal year, October 31, 2020, are as follows: Profit and loss agreement is 30:50:20.
Cash
P 150,000
Accounts receivable -net
200,000
Inventory
400,000
Plant Assets - net
700,000
Loan to South
50,000
Liabilities
P 500,000
West, Loan
100,000
North, Capital
450,000
South, Capital
300,000
West, Capital
150,000
The partners decide to liquidate the partnership. They estimate that the non-cash assets other than the loan to South can be realized into P 1,000,000 over the two-month period ending December 31, 2020. Cash is to be distributed to the appropriate parties as it becomes available during the liquidation process.
Required:
a) Assuming that P 650,000 is available for the first distribution, show how the available cash would be distributed.
b) Assuming that a total amount of P 75,000 is available for distribution to partners after liabilities to outside creditors have been paid, show how the cash will be distributed to the partners.
Definition Definition Money that the business will be receiving from its clients who have utilized the credit provided to buy its goods and services. The credit period typically lasts for a short term, lasting from a few days, a few months, to a year.
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