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Partcorp 10

The document provides details of a partnership's balance sheet as of June 30, 2006 including assets, liabilities and each partner's capital contribution and profit sharing ratio. It then describes events during July 2006 including the collection of receivables, sale of inventory and distribution of available cash on July 31 except for $2,000 set aside. It asks questions about the partnership equity on June 30, the cash available for distribution on July 31, and how much one partner would receive.

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ALMA MORENA
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55 views1 page

Partcorp 10

The document provides details of a partnership's balance sheet as of June 30, 2006 including assets, liabilities and each partner's capital contribution and profit sharing ratio. It then describes events during July 2006 including the collection of receivables, sale of inventory and distribution of available cash on July 31 except for $2,000 set aside. It asks questions about the partnership equity on June 30, the cash available for distribution on July 31, and how much one partner would receive.

Uploaded by

ALMA MORENA
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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For the items 6-8:

On June 30, 2006, the Win, Chimon and New partnership had the following fiscal year-end balance sheet:
Cash $ 4,000 Accounts payable $ 7,000
Accounts receivable 6,000 Loan from Chimon 5,000
Inventory 14,000 Win, capital (20%) 14,000
Plant assets-net 12,000 Chimon, capital (30%) 10,000
Loan to Win 6,000 New, capital (50%) 6,000
Total assets $ 42,000 Total liabilities & equity $ 42,000

The percentages shown are the residual profit and loss sharing ratios. The partners dissolved the partnership on July 1, 2006,
and began the liquidation process. During July, the following events occurred:

 Receivables of $3,000 were collected.


 The inventory was sold for $4,000.
 All available cash was distributed on July 31, except for $2,000 that was set aside for contingent expenses.

6. The book value of the partnership equity (i.e., total equity of the partners) on June 30, 2006 is:
7. The cash available for distribution to the partners on July 31, 2006:
8. How much cash would Chimon receive from the cash that is available for distribution on July 31?

9. Partner Piolo P. Garcia is personally insolvent, owing $400,000. Personal assets will only bring $150,000 when liquidated. At
the same time, Piolo has a credit capital balance in the partnership of $85,000. The capital amounts of the other partners total a
(credit) balance of $200,000. Under the doctrine of marshaling of assets, the personal creditors of Piolo can collect up to
__________.

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