Question

1. On July 20,2015 , Chloe, Lucifer and Amenadiel from a partnership investing cash of 105,000; 94,500 and 29,400, respectively. The partners share profits 3:2:2 and on October 30, 2015, they have cash of 7,000; other assets of 322,500; and liabilities of 179,200. On this date , they decided to go out of business and sell all the assets for 210,000. Amenadiel has personal assets of 10,500 that may , if necessary, be used to meet partnership obligations. What is the amount received by partner Lucifer at the end of liquidation?

2. On January 1, 2015, Globe Company sold for 17,500 a camera which had a cost of 11,375. The company received a down payment of 1,875 with the provision that additional payments of 1,562.50 be made monthly thereafter. Interest was to be charged at a monthly rate of 2% on the unpaid balance of the principal. After completing four months of installment, the customer defaulted, and the camera was repossessed. At this time, the net realizable of the camera (used) was computed at 4,687.50. Compute the loss on repossession.

Answer 1

1.

on the date of liquidation- (October 30,2015), the partnership has the following assets and liabilities-

cash	7000
Other Assets	322500
Less-Liabilities	(179200)
capital balances	150300

Assets of value sold 322500 was sold for 210000 with a loss of 112500.

Total cash available	=210000+7000 =217000
Less-Payment to Liabilities	(179200)
Balance cash available	37800

Capital balances as on date of liquidation	150300
Less-Loss on sale of assets	(112500)
Balance capital account balances	37800
Less-Cash distributed	(37800)

Amount received by Partner Licifier = 37800* (2/7) = 10800

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