Reference no: EM13883399
Assignment: Cash Distribution Plan
The partnership of Pen, Evan, and Torves has asked you to assist in winding up its business affairs. You compile the following information:
The trial balance of the partnership on June 30, 20X1, is:
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Debit
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Credit
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Cash
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$6,000
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Accounts Receivable (net)
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$22,000
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Inventory
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$14,000
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Plant and Equipment (net)
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$99,000
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Accounts Payable
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$55,000
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Pen, Capital
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$17,000
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Evan, Capital
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$45,000
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Torves, Capital
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$24,000
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Total
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$141,000
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$141,000
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The partners share profits and losses as follows: Pen 50 percent, Evan 30 percent, and Torves 20 percent.
The partners are considering an offer of $100,000 for the accounts receivable, inventory, and plant and equipment as of June 30. The $100,000 will be paid to creditors and the partners in installments, the number and amounts of which are to be negotiated.
Prepare a cash distribution plan as of June 20, 20X1, showing how much cash each partner will receive if the offer to sell the assets is accepted.
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: The partnership of Pen, Evan, and Torves has asked you to assist in winding up its business affairs. You compile the following information:
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