Aken, Prince, and Bird share profits and losses in the ratio of 2:3:5. They have decided...

 

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Aken, Prince, and Bird share profits and losses in the ratio of 2:3:5. They have decided to liquidate their partnership. The partnership balance sheet on January 31, Year 8, is as follows: Assets Liabilities and Equities Cash Noncash assets $ 40,000 200,000 Liabilities Bird, loan Aken, capital Prince, capital Bird, capital $ 50,000 20,000 45,000 75,000 50.000 $240.000 $240,000 During the liquidation of the partnership, the following events occur: • In February Year 8, noncash assets with a book value of $85,000 are sold for $55,000, and $21,000 is paid to outside creditors of the partnership. In March Year 8, the remaining noncash assets are sold for $70,000, and the rest of the outside creditors are paid. Liquidation expenses of $3,800 are also paid. • Cash is distributed to partners at the end of each month. Required 1. Prepare a cash distribution plan for the APB partnership on January 31, Year 8. 2. Calculate the amount that each partner received in both February and March. Aken, Prince, and Bird share profits and losses in the ratio of 2:3:5. They have decided to liquidate their partnership. The partnership balance sheet on January 31, Year 8, is as follows: Assets Liabilities and Equities Cash Noncash assets $ 40,000 200,000 Liabilities Bird, loan Aken, capital Prince, capital Bird, capital $ 50,000 20,000 45,000 75,000 50.000 $240.000 $240,000 During the liquidation of the partnership, the following events occur: • In February Year 8, noncash assets with a book value of $85,000 are sold for $55,000, and $21,000 is paid to outside creditors of the partnership. In March Year 8, the remaining noncash assets are sold for $70,000, and the rest of the outside creditors are paid. Liquidation expenses of $3,800 are also paid. • Cash is distributed to partners at the end of each month. Required 1. Prepare a cash distribution plan for the APB partnership on January 31, Year 8. 2. Calculate the amount that each partner received in both February and March.

Answer rating: 100% (QA)

Answer 1 Cash Distribution Plan Date Activity Amount 228 Sale o... View the full answer