Question

In business you get ________ ___ ______ by giving others _______ ______ ___________.

A three way partnership is formed with each partner putting in 1/3 of the invested money. The business fails owing $350,000 to creditors. Partner A and B have no personal assets. Partner C has $500,000 in cash and property. How much will each partner have to pay to settle their business debts? partner A: __________ partner B: __________ partner C: __________

Answer 1

Amount to be paid by each partner------

Partner A---- zero

Partner B---- zero

Partner C---- $ 350,000

In business ,you get more by giving others more

Explanation-------

Under Indian partnership Act, 1932-----

If a partnership firm, at the time of dissolution,declares its incapability to payoff outsiders debts, the partners' parsonal assets are acquired by court of law to payoff the debts ,again,if some of the partners declare them as insolvent , that is ,if their personal assets are insufficient to payoff their share of debt, a liability will arise to personally payoff the debt , in respect of such a partner who is solvent as the partners bear unlimited liability in partnership

In the given statement ---------

Liability still unpaid=$ 350000

Share of loss to each partner(1:1:1)= $116667

Each partner will have to pay it off out of his personal assets as they have unlimited limited .

As partners A & B have no personal assets, so their share of loss will also be borne by partner C

So, share of C= 116666+ 116667+ 116667=$350000