Question

Subject: VALUATION CONCEPTS AND METHOD

SIMPLE LIQUIDATION ILLUSTRATED

PETE, TO, AND ZACK HAS OPERATED A LAUNDRYMAT FOR 10 YEAR. THE PARTNERS, EHO SHARES PROFITS 4:3:3, RESPECTIVELY DECIDE TO LIQUIDATE THE PARTNERSHIP. THE FIRM'S BALANCD SHEET JUST BEFORE THE PARTNERS SELLS OTHER ASSETS FOR 30,000 IS AS FOLLOWS:

ASSETS LIABILITIES AND CAPITAL

CASH - 15,000 - WHERE IT CAME FROM LIABILITIES 42,000

OTHER ASSETS - 110,000 - WHERE IT CAME FROM PETE CAPITAL 55,000

TOTAL - 125,0000 TOM CAPITAL 14,000

ZACK CAPITAL 14,000 WHAT IS THE COMPUTATION WHY 14,000

TOTAL 125,000

PERSONAL OF EACH PARTNERS JUST BEFORE LIQUIDATION IS AS FOLLOWS:

ASSETS LIABILITIES

PETE 55,000 - WHERE IT CAME FROM 80,000 - WHY 80,000

TOM 30,000 - WHERE IT CAME FROM 10,000 - WHY 10,000

ZACK 30,000- WHERE IT CAME FROM 50,000 - WHY 50,000

DETERMINE THE AMOUNTS THAT THE PERSONAL CREDITORS WILL RECEIVE FROM ASSETS AND ANY DISGTRIBUTION FROM THE PARTNERSHIP.

PART B

PERSONAL ASSETS

PETE 55,000 - HOW ?

TOM 30,000 - HOW ?

ZACK 30,000 HOW ?

PERSONAL LIABILITIES

PETE 80,000 - HOW ?

TOM 10,000 - HOW ?

ZACK 50,000 - HOW ?

EXCESS (DEFICIENCY)

PETE (25,000) - HOW ?

TOM 20,000 - WHERE IT CAME FROM

ZACK (20,000) - HOW ?

DISTRIBUTION FROM PARTNERSHIP

PETE 17,286 - HOW TO COMPUTE THIS

TOM 0 - HOW ?

ZACK 0 - HOW ?

TOTAL PAYABLE TO CREDITORS

PETE - 72,286 - HOW ?

TOM - 10,000 - HOW ?

ZACK - 30,000 - HOW ?

KINDLY EXPLAIN WHY ALL THE FOLLOWINGS ARE HAPPEN AND THE COMPUTATION THEY USED IT TO SOLVED THE SIMPLE LIQUIDATION METHOD CAN YOU PLEASE SHOW ME CLEARLY I WANT TO STUDY VERY BROAD OF THE COMPUTATION THAT THEY USE SPECIALLY THOSE PERCENTAGE THEY USE IN TOTALS BECAUSE I WAS CONFUSE WHERE THEY GET THE LIABILITIES AND CAPITALS, THE DISTRIBUTION FROM PARTNERSHIP AND THE TOTAL PAYABLE TO CREDITORS, THANK YOU SO MUCH.

Thank you so much for your answer but i have a additional question in the simple liquidation i want to know where they get the total of a

DISTRIBUTION FROM PARTNERSHIP

PETE 17,286 - HOW TO COMPUTE THIS

TOM 0 - HOW ?

ZACK 0 - HOW ?

like this ? and the

TOTAL PAYABLE TO CREDITORS

PETE - 72,286 - HOW ?

TOM - 10,000 - HOW ?

ZACK - 30,000 - HOW ?

thank you so much for the one who answer this again.