FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:In partnership liquidation the first cash distribution should be made for
Select one:
a. loan to bank
b. partner capital
c. loan to partner
d. Liquidation expenses
000
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- In a partnership liquidation, the final cash payment to the partners should be made in accordance with the*a. balance of partners' capital accounts.b. partner's profit and loss sharing ratio.c. ratio of the capital contributions by partners.d. safe payment computations.arrow_forwardAn incoming partner may acquire an interest in the partnership for a price in excess of that indicated by the book value of the original partnership’s net assets. This situation would suggest the existence of: a. Unrecognized Goodwill b. Recognized Profit c. Unrecognized capital d. Unrecognized excess of casharrow_forwardUnder what circumstance might goodwill be allocated to a new partner entering a partnership?arrow_forward
- What are the steps involved in a partnership liquidation?arrow_forwardHow does a newly formed partnership handle the contribution of previously depreciated assets?arrow_forwardOne of the final steps in terminating a partnership is the distribution of remaining assets to the partners after all obligations have been met. What is the basis for distributing any remaining assets/cash among the partners? How would loans from partners affect the distribution of partnership assets?arrow_forward
- What is a partnership dissolution? Does dissolution automatically necessitate the cessation of business and the liquidation of partnership assets?arrow_forwardThere is a liquidation of assets of a partnership. Describe the order in which assets must be distributed upon liquidation of a partnership, and explain the "right-of-offset" concept.arrow_forwardWhen a partnership is created, what is the contract called that gives the amounts invested by each partnership, how income and losses should be distributed, etc.? Group of answer choices partnership charter partnership partnership agreement none of thesearrow_forward
- What information do the capital accounts found in partnership accounting convey?arrow_forwardCurrent cash distributions from partnerships are nontaxable unless they exceed the partner's basis in the partnership. T or Farrow_forwardIn a partnership, distinguish between the goodwill and bonus methods.arrow_forward
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