Question

In: Accounting

Determine the amount received by Ellis as a final distribution from liquidation of the partnership.


Prior to liquidating their partnership, Ellis and Dunn had capital accounts of $63,000 and $106,000, respectively. Prior to liquidation, the partnership had no cash assets other than what was realized from the sale of assets. These partnership assets were sold for $188,000. The partnership had $5,000 of liabilities. Ellis and Dunn share income and losses equally.


Determine the amount received by Ellis as a final distribution from liquidation of the partnership.

Solutions

Expert Solution

Total Non-cash Assets will be $ 174,000 =63000+106000+5000
Gain on sale of Non-cash assets           14,000 =188000-174000
Distribution of Gain to partners
Ellis             7,000 =14000/2
Dunn             7,000 =14000/2
Capital Account of Partners after allocation of Gain
Ellis           70,000
Dunn        113,000 =106000+7000
Remaining cash after payment of Liabilities        183,000 =188000-5000
Amount received by Ellis as a final distribution from liquidation of the partnership $ 70,000

ekkarill92 answered 3 years ago
Next > < Previous

Related Solutions

Determine the amount of cash received from customers.
Sales reported on the income statement were $480,000. The accounts receivable balance increased $54,000 over the year. Determine the amount of cash received from customers.
A) Discuss the difference between dissolution of a partnership and liquidation of a partnership. B) List...
A) Discuss the difference between dissolution of a partnership and liquidation of a partnership. B) List the order of distribution when a partnership is dissolved. C) Define - Share Authorized, Share Issued, and Shares Outstanding.
Rick is a partner in the Ten Hicks Partnership. This year, he received a distribution consisting...
Rick is a partner in the Ten Hicks Partnership. This year, he received a distribution consisting of two properties. Property 1 was worth $40,000 at the date of the distribution and had a tax basis to the partnership of $28,000. Property 2 was worth $60,000 and had a tax basis of $12,000. Rick’s tax basis in his partnership interest was $30,000 prior to the distribution. The partnership did not have any hot assets either before or after the distribution. a....
Explain with the support of an illustration the process of termination and liquidation of a partnership?...
Explain with the support of an illustration the process of termination and liquidation of a partnership? (With supportive example)
Explain with the support of an illustration the process of termination and liquidation of a partnership?...
Explain with the support of an illustration the process of termination and liquidation of a partnership? (With supportive example)
Statement of Partnership Liquidation After closing the accounts on July 1, prior to liquidating the partnership,...
Statement of Partnership Liquidation After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances of Gold, Porter, and Sims are $31,800, $45,000, and $20,100, respectively. Cash, noncash assets, and liabilities total $47,100, $83,400, and $33,600, respectively. Between July 1 and July 29, the noncash assets are sold for $66,600, the liabilities are paid, and the remaining cash is distributed to the partners. The partners share net income and loss in the ratio of 3:2:1....
Statement of Partnership Liquidation After closing the accounts on July 1, prior to liquidating the partnership,...
Statement of Partnership Liquidation After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances of Gold, Porter, and Sims are $27,600, $39,300, and $17,400, respectively. Cash, noncash assets, and liabilities total $42,900, $72,600, and $31,200, respectively. Between July 1 and July 29, the noncash assets are sold for $58,200, the liabilities are paid, and the remaining cash is distributed to the partners. The partners share net income and loss in the ratio of 3:2:1....
Determine the amount of the dividends received deduction in each of the following instances. In all...
Determine the amount of the dividends received deduction in each of the following instances. In all cases, the net income figure includes the full dividend. Dividend of $10,000 from a 45% owned corporation; taxable income before DRD of $50,000. Dividend of $19,000 from a 15% owned corporation; taxable income before DRD of $75,000. Dividend of $22,000 from a 60% owned corporation; taxable income before DRD of $11,000. Dividend of $8,000 from a 10% owned corporation; taxable income before DRD of...
wk 5 assing 1 Determine the amount of the dividends received deduction in each of the...
wk 5 assing 1 Determine the amount of the dividends received deduction in each of the following instances. In all cases, the net income figure includes the full dividend. Use Dividends deduction table. Dividend of $11,500 from a 45% owned corporation; taxable income before DRD of $54,500. Dividend of $19,900 from a 15% owned corporation; taxable income before DRD of $78,000. Dividend of $13,000 from a 60% owned corporation; taxable income before DRD of $7,000. Dividend of $3,500 from a...
Choose at least two concepts from the following: partnership, corporation, liquidation, bankruptcy chapter 7, bankruptcy chapter...
Choose at least two concepts from the following: partnership, corporation, liquidation, bankruptcy chapter 7, bankruptcy chapter 11, reorganization, trust, estates, consolidation, parent company, subsidiary, acquisition, partnerships termination, variable interest entity, equity method, fair value method. Required: Explain how you may use them in your present or future accounting position. Make sure you provide details to include how each concept will help you support the financial goals of the company you currently work for or will work for in the future.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT