Question

QS 11-3 Journal entry when forming a partnership LO2

Len Peters and Beau Silver form a partnership to operate a catering business, called A Catered Affair. Peters invests $20,000 cash and Silver invests $30,000 cash on March 1, 2017. Prepare the journal entry to record the establishment of the partnership.

QS 11-2 Liability in limited partnerships LO1

Stanley organized a limited partnership and is the only general partner. Hillier invested $20,000 in the partnership and was admitted as a limited partner with the understanding that he would receive 10% of the profits. After two unprofitable years, the partnership ceased doing business. At that point, partnership liabilities were $85,000 larger than partnership assets. How much money can the creditors of the partnership obtain from the personal assets of Hillier in satisfaction of the unpaid partnership debts?

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Answer 1