Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. the pen, evan, and torves partnership has asked yo

The Pen, Evan, and Torves Partnership has asked you to assist in winding-up its business...

50.1K

Verified Solution

Question

Accounting

The Pen, Evan, and Torves Partnership has asked you to assist in winding-up its business affairs. You compile the following information:

  1. The partnerships trial balance on June 30, 20X1, is
Debit Credit
Cash $ 6,400
Accounts Receivable (net) 24,000
Inventory 18,000
Plant and Equipment (net) 99,300
Accounts Payable $ 11,500
Pen, Capital 59,000
Evan, Capital 49,200
Torves, Capital 28,000
Total $ 147,700 $ 147,700
  1. The partners share profits and losses as follows: Pen, 50 percent; Evan, 30 percent; and Torves, 20 percent.
  2. The partners are considering an offer of $104,000 for the firms accounts receivable, inventory, and plant and equipment as of June 30. The $104,000 will be paid to creditors and the partners in installments, the number and amounts of which are to be negotiated.

Required: Prepare a cash distribution plan as of June 30, 20X1, showing how much cash each partner will receive if the partners accept the offer to sell the assets.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students