The December $31$ balance sheet accounts of the Dan, Jim, and Mary Partnership are:

Cash $$20,000$

Inventory $120,000$

Plant assets$-$ net $300,000$

Accounts Payable $170,000$

Dan, Capital $100,000$

Jim, Capital $90,000$

Mary, Capital $80,000$

The partners share profits & losses: Dan$-50\%,$ Jim$-30\%,$ and Mary$-20\%$

The partners decide to liquidate the partnership. They agree that all cash should be distributed as soon as it becomes available during the liquidation process. They also agree that a cash predistribution plan is necessary to facilitate the distribution of cash.

Question $1$

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According to the predistribution plan:

Question $14$ options:

a$)$

Cash is split $50\%,30\%,20\%$ after creditors are paid.

b$)$

Mary gets the first $$20,000,$ Jim & Mary split the next $$50,00060/40,$ and any remainder is split $50/30/20.$

c$)$

Mary gets the first $$100,000,$ Jim & Mary split the next $$200,00060/40,$ and any remainder is split $50/30/20.$

d$)$

Dan gets the first $$100,000,$ Jim the next $$90,000$ & Mary the next $$80,000.$ Any remainder is split $50/30/20.$

Question $15(1$ point$)$

If cash of $$220,000,$ including the $$20,000$ cash on hand, becomes available, it should be distributed in accordance with the cash predistribution plan.

How much should be distributed to the creditors and partners respectively? 

 

Creditors Dan Jim Mary ddd

A $$170,000$ $$25,000$ $$15,000$ $$10,000$

B $$170,000$ $$0$ $$26,000$ $$24,000$

C $$170,000$ $$10,000$ $$32,000$ $$8,000$

D $$170,000$ $$0$ $$18,000$ $$32,000$

 

Answer rating: 100% (QA)

The answer is B 170000 to creditors 0 to Dan 26000 to Jim and 24000 to Mary Heres the breakdown 1 Pa... View the full answer