Problem 7Hello, Hai and Goodbye are partners sharing profits and loss in the ratio of 1:1:2, respectively.They decided to liquidate the business. The assets were sold and liabilities amounting to P20,000were paid. At this point, the capital balances of the partners are as follows:HelloHaiGoodbyeP20,000 credit15,000 debit30,000 creditHai is personally insolvent.42. How much is the cash available for distribution to partners?43. How much cash should Hello receive? (Round answer to the nearest peso)

The calculation as, Let, A be Hello, B be Hai, C be Goodbye.

Answered: martners sharing profits and loss in…

Business

Accounting

martners sharing profits and loss in usiness. The assets were sold and I apital balances of the partners are a

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter7: Deductions And Losses: Certain Business Expenses And Losses

Section: Chapter Questions

Problem 42P

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Concept explainers

Partnership Accounting

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.

Partner Admission and Withdrawal

A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.

Question

Problem 7
Hello, Hai and Goodbye are partners sharing profits and loss in the ratio of 1:1:2, respectively.
They decided to liquidate the business. The assets were sold and liabilities amounting to P20,000
were paid. At this point, the capital balances of the partners are as follows:
Hello
Hai
Goodbye
P20,000 credit
15,000 debit
30,000 credit
Hai is personally insolvent.
42. How much is the cash available for distribution to partners?
43. How much cash should Hello receive? (Round answer to the nearest peso)

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