Homework Answers
Assuming all non-cash assets and liabilities can be sold/paid at their balance sheet value.
Total Cash available from Assets = Cash + Non-cash assets
= 71,520 + 132,000
= 203,520
Total available cash for distribution = Cash available from assets - Liabilities - Liquidation expenses
= 203,520 - 48,000 - 15,200
= 140,320
Distribution among partners:
| Partner Name | Profit/Loss Distribution ratio | Distribution % | Distribution $ | Capital $ | |
| Delphine | 3 | 3/3+4+3 = 3/10 = 30% |
30%*140320 = 42,096 |
60,960 | |
| Xavier | 4 | 4/3+4+3 = 4/10 = 40% |
40%*140320 = 56,128 |
56,000 | |
| Olivier | 3 | 3/3+4+3 = 3/10 = 30% |
30%*140320 = 42,096 |
38,560 |
Since, Delphine shall receive only $42,096 in the liquidation but her exposure (capital) is more, that is, $60,960, she shall be eligible to receive a cash distribution to the extent 60960 - 42096 = $18,864
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