The partnership of Winn, Xie, Yang, and Zed has the following balance sheet: Cash Other assets $ 37,000 243,000 Liabilities Winn, capital (50% of profits and losses) Xie, capital (30 %) Yang, capital (10%) Zed, capital (10%) $48,000 67,000 81,000 47,000 37,000 Zed is personally insolvent, and one of his creditors is considering suing the partnership for the $3,000 that is currently owed. The creditor realizes that this litigation could result in partnership liquidation and does not wish to force such an extreme action unless Zed is reasonably sure of obtaining at least $3,000 from the liquidation. Prepare a predistribution plan to determine the amount for which the partnership must sell the other assets to ensure that Zed receives $3,000 from the liquidation. Liquidation expenses are expected to be $22,000.(Do not round intermediate calculations.)
The partnership of Winn, Xie, Yang, and Zed has the following balance sheet: Cash Other assets $ 37,000 243,000 Liabilities Winn, capital (50% of profits and losses) Xie, capital (30 %) Yang, capital (10%) Zed, capital (10%) $48,000 67,000 81,000 47,000 37,000 Zed is personally insolvent, and one of his creditors is considering suing the partnership for the $3,000 that is currently owed. The creditor realizes that this litigation could result in partnership liquidation and does not wish to force such an extreme action unless Zed is reasonably sure of obtaining at least $3,000 from the liquidation. Prepare a predistribution plan to determine the amount for which the partnership must sell the other assets to ensure that Zed receives $3,000 from the liquidation. Liquidation expenses are expected to be $22,000.(Do not round intermediate calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The partnership of Winn, Xie, Yang, and Zed has the following balance sheet:
Cash
Other assets
$ 37,000
243,000
Liabilities
Winn, capital (50% of profits and losses)
Xie, capital (30%)
Beginning capital
Assumed loss of Schedule 1
Yang, capital (10%)
Zed, capital (10%)
Step one balances
Assumed loss of Schedule 2
Step two balances
Assumed loss of Schedule 3
Step three balances
Zed is personally insolvent, and one of his creditors is considering suing the partnership for the $3,000
that is currently owed. The creditor realizes that this litigation could result in partnership liquidation and
does not wish to force such an extreme action unless Zed is reasonably sure of obtaining at least $3,000
from the liquidation.
Prepare a predistribution plan to determine the amount for which the partnership must sell the other
assets to ensure that Zed receives $3,000 from the liquidation. Liquidation expenses are expected to be
$22,000.(Do not round intermediate calculations.)
$
$
$
$
Winn
67,000 $
67,000 $
67,000 $
67,000 $
Xie
81,000 $
81,000 $
81,000 $
81,000 $
Yang
47,000 $
47,000 $
$48,000
67,000
47,000 $
81,000
47,000
37,000
47,000 $
Zed
37,000
37,000
37,000
37,000
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