. TRUE or FALSE: During a winding up of a partnership, all debts of the partnership are paid and the remaining proceeds are distributed to the partners. Group of answer choices True False
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- When a partnership dissolves, the last step in the dissolution process is to ________. A. allocate the gain or loss on sale based on income sharing ratio B. pay off liabilities C. sell noncash assets D. divide the remaining cash among the partnersWhen a partnership liquidates, do partners get paid first or do creditors get paid first?Withdrawal of Partner Lane Stevens is to retire from the partnership of Stevens and Associates as of March 31, the end of the current fiscal year. After closing the accounts, the capital balances of the partners are as follows: Lane Stevens, $150,000; Cherrie Ford, $70,000; and LaMarcus Rollins, $60,000. They have shared net income and net losses in the ratio of 3:2:2. The partners agree that the merchandise inventory should be increased by $22,300 and the allowance for doubtful accounts should be increased by $1,300. Stevens agrees to accept a note for $100,000 in partial settlement of his ownership equity. The remainder of his claim is to be paid in cash. Ford and Rollins are to share equally in the net income or net loss of the new partnership. a. Journalize the entry to record the adjustment of the assets to bring them into agreement with current market prices. If an amount box does not require an entry, leave it blank. b. Journalize the entry to record the withdrawal of Stevens…
- 18. A mode of settling the interest of a retiring partner that affects the partnership assets. A. Payment by an outsider B.Payment by any of the remaining partners. C.Proportional payment by all of the remaining partners D. Payment by the partnership E. Answer not givenThe first step in the liquidation of a partnership is to* allocate a gain or loss on realization to the partners. O distribute remaining cash to the partners. O pay partnership liabilities. sell noncash assets and recognize a gain or loss on realization.1) A partner may withdraw or retire from the partnership byA. selling his interest to an outsiderB.payment of his interest from partnership fundsC. selling his interest to one or more of the remaining partnersD. any of the above 2) X retired from the partnership of X, Y and Z. X received an amount in excess of his capital balance in settlement of his equity. All assets of the partnership are fairly valued. Under these circumstances,A. the partnership shall recognize goodwillB. the partnership shall recognize an expenseC. the capital balances of Y and Z would decreaseD. the capital balances of Y and Z would not be affected 3) A partner may withdraw or retire from the partnership byA. selling his interest to an outsiderB. payment of his interest from partnership fundsC. selling his interest to one or more of the remaining partnersD. any of the above
- Heginio Lacson, Joel Jo, and Alex Ajoc are partners who shared profit and losses of 30%, 50%, and 20%, respectively. Jo decides to withdraw from the partnership. Their respective capital account balances after partnership s books have been adjusted, as follows: Heginio Lacson P60,000 Joel Jo P85,000 Alex Ajoc P55,000 Required: 1. Prepare journal entry to record the withdrawal of Joel Jo from the partnership under the following assumptions: Alex Ajoc buys his share for P90,000. b. Heginio Lacson buys his share and4 by Alex Ajoc. Marco Ocenar, and outsider buys his interest for P80,000. a. C. Assumption a: Assumption b: Assumption c:A, one of the partners in the ABC Partnership, decided to buy the share of B in the partnership. Which of the following statements is not true? a. Partners’ equity in total amount will not change. b. Partnership assets will remain the same. c. There is no need to revise the partners’ equity. d. Partnership profit and loss ratio will change.In case of admission of a partner, the first adjustment that need to be prepared is?? A. Bank account B. Profit and loss account adjustment C. The revaluation of assets D. Realization of income or loss S1: In a partnership, at least one partner is required to be a/an limited partner in order to ensure partnership creditors will be paid and protected S2: Unpaid liabilities should be included in computing for the total loss attributed to the partners. * A. Both statements are true B. s1 True; S2 False C. S2 True; S1 False D. Both statements are false S1: Joint Control is present if tow ore more parties have greater than 50% Control.S2: One Party has more than 50% in a joint arrangement * A. Both statements are false B. Both statements are true C. S2 True; S1 False D. s1 True; S2 False S1: If the total contributed capital of THE partnership is greater than the total agreed capital, it is possible that a goodwill be recognized or an undervaluation of asset occurred.S2: Noncash…
- A, one of the partners in the ABC Partnership, decided to buy the share of B in the partnership. Which of the following statements is not true? a. Partners’ equity in total amount will not change. b. Partnership assets will remain the same. c. Partnership profit and loss ratio will change. d.There is no need to revise the partners’ equity.17. When a partner dies or withdraw from the partnership, his capital in the partnership must be adjusted for the following, before settlement, except: A. Share in the net income of the partnership till the date of death or withdrawal B. Share in the adjustment of partnership assets to their fair values at date of death or withdrawal C. Share in adjustment of partnership liabilities to their fair values at date of death or withdrawal D. None of the above. E. Answer not givenChoose the correct. If a partnership is liquidated, how is the final allocation of business assets made to the partners?a. Equally.b. According to the profit and loss ratio.c. According to the final capital account balances.d. According to the initial investment made by each of the partners.