Question

Partners Mera, Husam, and Jalal have capital account balances of $45,000 each. The income and loss...

Partners Mera, Husam, and Jalal have capital account balances of $45,000 each. The income and loss ratio is 5:2:3, respectively. In the process of liquidating the partnership, noncash assets with a book value of $37,500 are sold for $15,000. The balance of Husam’s Capital account after the sale is:
Select one:
a. $40,500.
b. $33,750.
c. $38,250.
d. $49,500.
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The correct answer is a. $40,500.

Partnership business is a kind of business where two or more persons are joined together and carry out the business activities. The profits or losses arising from the business activities will be shared by the partners in an agreed ratio.

The capital balance of Husam before the sale of non cash assets was, $45,000.

Husam's ratio = 2/10

Loss on sale of non cash assets = Book value of assets - Cash received from sale of assets
= $37,500 - $15,000 = $22,500

This loss on sale of non cash assets is adjusted to the partners capital balances according to their given ratio.

Husam's share of loss = $22,500 × 2/10 = $4,500

Hence, Husam's capital balances after sale will be $45,000 - $4,500 = $40,500.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances of Gold, Porter, and Sims are $55,000, $45,000, and $20,000, respectively. Cash, noncash assets, and liabilities total $56,000, $96,000, and $32,000, respectively. Between July 1 and July 29, the noncash assets are sold for $90,000, 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. Prepare a statement of...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances of Gold, Porter, and Sims are $40,800, $58,200, and $25,800, respectively. Cash, noncash assets, and liabilities total $65,700, $107,700, and $48,600, respectively. Between July 1 and July 29, the noncash assets are sold for $86,100, 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. Prepare a statement of...
In liquidation, just prior to the final distribution of cash to the partners, the balance in...
In liquidation, just prior to the final distribution of cash to the partners, the balance in the Cash account is $600,000; The partners have capital balances as follows: Presley, $290,000 credit; Laswell, $250,000 credit, and Hunter, $60,000 credit. The income ratio is 6:2:2, respectively. How much cash should be distributed to Presley? Partners Audrey, Betty, and Charles have capital account balances of $210,000 each. The income and loss ratio is 5:2:3, respectively. In the process of liquidating the partnership,noncash assets...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances of Gold, Porter, and Sims are $59,920, $45,610, and $20,390, respectively. Cash, noncash assets, and liabilities total $59,380, $99,150, and $32,610, respectively. Between July 1 and July 29, the noncash assets are sold for $93,150, 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. Prepare a statement of...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances...
After closing the accounts on July 1, prior to liquidating the partnership, the capital account balances of Gold, Porter, and Sims are $41,700, $59,400, and $26,400, respectively. Cash, noncash assets, and liabilities total $67,500, $110,100, and $50,100, respectively. Between July 1 and July 29, the noncash assets are sold for $87,900, 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. Prepare a statement of...
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 $45,000, $63,900, and $28,500, respectively. Cash, noncash assets, and liabilities total $66,600, $118,500, and $47,700, respectively. Between July 1 and July 29, the noncash assets are sold for $94,500, 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....
A company has bonds outstanding with a par value of $100,000. The unamortized discount on these...
A company has bonds outstanding with a par value of $100,000. The unamortized discount on these bonds is $4,500. The company retired these bonds by buying them on the open market at 97. What is the gain or loss on this retirement? Select one: a. $1,500 gain. b. $3,000 gain c. $0 gain or loss. d. $1,500 loss. Partners Ana, Beth, and Cathy have capital account balances of $90,000 each. The income and loss ratio is 5:2:3, respectively. In the...
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 $24,000, $34,200, and $15,300, respectively. Cash, noncash assets, and liabilities total $36,600, $63,300, and $26,400, respectively. Between July 1 and July 29, the noncash assets are sold for $50,700, 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 $22,200, $31,800, and $14,100, respectively. Cash, noncash assets, and liabilities total $36,600, $58,800, and $27,300, respectively. Between July 1 and July 29, the noncash assets are sold for $46,800, 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....
Immediately prior to the process of liquidation on December 31, 2014 partners Micco, Niccum, and Orwell...
Immediately prior to the process of liquidation on December 31, 2014 partners Micco, Niccum, and Orwell of MNO Partnership have capital balances of $70,000, $20,000, and $40,000, respectively. There is a cash balance of $20,000, noncash assets total $170,000, and liabilities total $60,000. The partners share net income and losses in the ratio of 3:2:1. (Different than lecture.) If there is a defeciency assume the partner pays it. Sold non-cash assets for $80,000. 1. Prepare the Statement of Partnership Liquidation...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT