Question

QS 12-9 Liquidation of partnership LO P5

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The Field, Brown & Snow partnership was begun with investments by the partners as follows: Field, $130,500; Brown, $167,300; and Snow, $155,800. The partners decide to liquidate, sharing all losses equally. On May 31, after all assets were sold and all creditors were paid, only $48,300 in partnership cash remained.

QS 12-9 Part 1

1. Compute the capital account balance of each partner after the liquidation of assets and payment of creditors. (Losses and negative capital balances, if any, should be entered with a minus sign.)

Initial Investments

Allocations of Gains

Capital Balances

Answer 1

1. In the given Problem, since the losess are Sharing equelly which is agreed by all forters and only $ 48300 is available as portmanship Cash then lenital account balance each Forhner Can be lalulated as - Sivien ench Portner has alredy Contributeel a to alands losess equally thoon , 8o the remaining balenes heill be distributed among Partners in their lapital Contribution Raho. Such as. O field Ibnown Snow. I Each forhans lepital (130500167300 158500. Each partners Capital to 0.287 10.368 10.343. total lepital Ratio, Distribution of cash distribution of Cash 113862 117774 16567 balance in abow Ratio There for Ceptul Nacount balance of each partner after liquidation and peryment of Creclitors is Field 13868, brown - 17 774 Snow - 16567 Scanned with Not tantele 130500 +167300 tis-5-500 2453600