How much would be paid to A

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Question - The ABC Partnership has the following capital balances and profit/loss sharing percentages:

Partner Capital Profit/loss %

A 300,000 25%

B 350,000 35%

C 500,000 40%

1) Assume the partnership has $50,000 in cash, $1,130,000 in non-cash assets, and $30,000 in liabilities. They wish to hold back an additional $10,000 for unforeseen expenses. How much cash would be paid to which partner?

2) Assume that the $10,000 is paid out in question 1, so now the partnership has $40,000 in cash. $300,000 of the non-cash assets are sold for 150,000 (total cash now $190,000). Create schedule of safe payments, again assuming that the partnership wants to hold back $10,000 for possible expenses. How much cash would A receive (xx,xxx)?

3) Go back to the original data and Create cash distribution plan. In the "first stage", how much would go to which partner?

4) Go back to the original data and create cash distribution plan. If the firm had $100,000 to distribute, how much would be paid to "A"?

5) Go back to the original data and create cash distribution plan. If the firm had $300,000 to distribute, how much would be paid to "A"?

Reference no: EM132747379

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