When a partnership is liquidated, which of the following statements is FALSE? Non-cash assets are converted to cash. ) Any liquidation gain or loss is allocated to the partners' capital accounts using the income and loss sharing ratio. Liabilities are paid or settled. Any remaining cash is distributed using the partners' income and loss sharing ratio. Any remaining cash is distributed based on the partners' capital account balances.
When a partnership is liquidated, which of the following statements is FALSE? Non-cash assets are converted to cash. ) Any liquidation gain or loss is allocated to the partners' capital accounts using the income and loss sharing ratio. Liabilities are paid or settled. Any remaining cash is distributed using the partners' income and loss sharing ratio. Any remaining cash is distributed based on the partners' capital account balances.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:When a partnership is liquidated, which of the following statements is FALSE?
Non-cash assets are converted to cash.
OAny liquidation gain or loss is allocated to the partners' capital accounts using
the income
and loss sharing ratio.
O Liabilities are paid or settled.
OAny remaining cash is distributed using the partners' income and loss sharing
ratio.
Any remaining cash is distributed based on the partners' capital account
balances.
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