FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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The year-end
Cash $ 60,000 Accounts payable $ 150,000
Loan to Gary 50,000 Loan from Harold 50,000
Other assets 360,000 Gary, capital (25%) 70,000
Harold, capital (25%) 80,000
Ivan, capital (50%) 120,000
Total assets $ 470,000 Total liab./equity $ 470,000
The partners agree to liquidate the business and distribute cash when it becomes available. A cash distribution plan is developed with vulnerability rankings for the Gary, Harold and Ivan partnership. After outside creditors are paid, the cash available will initially go to
| A. |
Gary in the amount of $20,000. |
|
| B. |
Ivan in the amount of $40,000. |
|
| C. |
Harold in the amount of $50,000. |
|
| D. |
Harold in the amount of $70,000. |
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