The partners of the 3E Partnership have decided to liquidate their partnership. The partnership statement of financial position just prior to liquidation is presented below: Assets Liabilities & Capital P 308,500 Cash P 63,000 455,500 Other Assets 90,000 Liabilities Escobar, Capital Elloso, Capital Echaves, Capital 90,000 30,000 P518,500 P 518,500 The other assets include a note receivable from Escobar in the amount of P75,000. The liabilities include a note payable to Elloso of P40,000 and a note payable to Echaves of P60,000. The partners share profits and losses in the ratio of 2:2:1, respectively. Instructions: 1. Determine the amount of cash each partner will receive for each of the following independent assumptions: a. The other assets are sold for P300,000 and all the partners are solvent. b. The other assets are sold for P270,000 and Escobar is insolvent. Escobar's net worth, exclusive of his interest in the partnership, is P4,000. C. The other assets are sold for P270,000 and P24,875 of liquidation expenses are paid. Escobar is insolvent.

The partners of the 3E Partnership have decided to liquidate their partnership. The partnership statement of financial position just prior to liquidation is presented below: Assets Liabilities & Capital P 308,500 Cash P 63,000 455,500 Other Assets 90,000 Liabilities Escobar, Capital Elloso, Capital Echaves, Capital 90,000 30,000 P518,500 P 518,500 The other assets include a note receivable from Escobar in the amount of P75,000. The liabilities include a note payable to Elloso of P40,000 and a note payable to Echaves of P60,000. The partners share profits and losses in the ratio of 2:2:1, respectively. Instructions: 1. Determine the amount of cash each partner will receive for each of the following independent assumptions: a. The other assets are sold for P300,000 and all the partners are solvent. b. The other assets are sold for P270,000 and Escobar is insolvent. Escobar's net worth, exclusive of his interest in the partnership, is P4,000. C. The other assets are sold for P270,000 and P24,875 of liquidation expenses are paid. Escobar is insolvent.

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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