David Oliver and Umar Ansari, with capital balances of $58,000 and $78,000, respectively, decide to liquidate...
David Oliver and Umar Ansari, with capital balances of $58,000 and $78,000, respectively, decide to liquidate their partnership. After selling the noncash assets and paying the liabilities, there is $170,000 of cash remaining. If the partners share income and losses equally, how should the cash be distributed?
Homework Answers
Capital, David = $58,000
Capital, Umar = $78,000
Cash remaining after paying liabilities = $170,000
Gain on disposal of assets = Cash remaining after paying liabilities - Capital, Umar - Capital, David
= 170,000 - 78,000 - 58,000
= $34,000
Gain to be shared by David = 34,000 x 1/2
= $17,000
Gain to be shared by Umar = 34,000 x 1/2
= $17,000
Cash received by David as final distribution from liquidation of partnership = Capital, David + Share of gain
= 58,000 + 17,000
= $75,000
Cash received by Umar as final distribution from liquidation of partnership = Capital, Umar + Share of gain
= 78,000 + 17,000
= $95,000
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David Oliver and Umar Ansari, with capital balances of $58,000
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David Oliver and
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respectively, decide to liquidate their partnership. After selling
the noncash assets and paying the liabilities, there is $103,000 of
cash remaining. If the partners share income and losses equally,
how should the cash be distributed?
If an amount is zero, enter in
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and oses equaly, ow he cash be dsbributed
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cash remaining. If the partners share income and losses equally,
how should the cash be distributed?
If an amount is zero, enter in
"0".
and oses equaly, ow he cash be dsbributed
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Distributed safe capital balances immediately to the partners.
Liquidation expenses of $19,800 are estimated as a basis for this
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Sold noncash assets with a book value of $176,000 for
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