В. Pisces, Leo and Gemini share profits in the ration of 5:3:2, respectively. Capital and loan balances just prior to partnership liquidation are: CAPITAL LOANS Pisces P 120,000 Pisces P 45,000 Leo 90,000 Leo 30,000 Gemini 40,000 Gemini 13,000 Non-cash assets are sold, and cash is distributed to partners in monthly installments during the course of liquidation as follows: January – P 15,000; February - P 40,000; March – P 90,000; April – P 30,000 (final distribution) Required: a) Prepare a program to show how cash should be distributed during the entire course of liquidation,
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
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Pisces, Leo and Gemini share profits in the ration of 5:3:2, respectively. Capital and loan balances just prior to |
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CAPITAL |
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Pisces, Capital |
P 120,000 |
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Leo, Capital |
90,000 |
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Gemini, Capital |
40,000 |
LOANS
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Pisces, Loan |
P 45,000 |
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Leo, Loan |
30,000 |
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Gemini, Loan |
13,000 |
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Non-cash assets are sold, and cash is distributed to partners in monthly installments during the course of liquidation as follows: |
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January – P 15,000; February – P 40,000; March – P 90,000; April – P 30,000 (final distribution) |
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Required:
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