A partnership has the following account balances: Cash, $95,000; Other Assets, $665,000; Liabilities, $305,000; Nixon (50...

A partnership has the following account balances: Cash, $95,000; Other Assets, $665,000; Liabilities, $305,000; Nixon (50 percent of profits and losses), $215,000; Cleveland (30 percent), $150,000; Pierce (20 percent), $90,000. The company liquidates, and $20,500 becomes available to the partners. Who gets the $20,500? Determine how much of this amount should be distributed to each partner.(Do not round intermediate calculations.)

Solutions

Expert Solution

Distribution assuming distribution is done in the ratio of profit sharing
	Cash	Nixon	Cleveland	Pierce
Cash available and balances of capital	$ 20,500.00	$ 215,000.00	$ 150,000.00	$ 90,000.00

Distribution to Partners (20500 In ratio of profit sharing)	$ (20,500.00)	$ 10,250.00	$ 6,150.00	$ 4,100.00
Balance After Distribution	$ -	$ 204,750.00	$ 143,850.00	$ 85,900.00

Please consider the given below alternate solution if your answer does not match

Distribution assuming distribution is done in the ratio of partner's capital
	Cash	Nixon	Cleveland	Pierce
Cash available and balances of capital	$ 20,500.00	$ 215,000.00	$ 150,000.00	$ 90,000.00

Distribution to Partners (20500 In ratio of profit sharing)	$ (20,500.00)	$ 9,686.81	$ 6,758.24	$ 4,054.95
Balance After Distribution	$ -	$ 205,313.19	$ 143,241.76	$ 85,945.05

ekkarill92 answered 1 year ago

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