Saturday, July 23, 2011

Accounting question which deals with partnerships please help?

Brewster, Conway and Ogden are partners who share income and loss in a 1:5:4 ratio. After lengthy disagreements among partners the partners and several unprofitable periods, the partners decide to liquidate the partnership. Immediately before liquidation, the partnership balance sheet shows total assets, 117000; total liabilities 87750 brewster capital 1600, conway capital 11600, ogden capital 16050. The cash proceeds from selling the assets were sufficient to repay all but 20500 to the creditors. a) calculate the loss from selling assets. b) allocate the loss to partners c) determine how much of the rmaining libility should be paid to each partner. what i dont get is the 1:5:4 ratio. how do you allocate the loss based on that ratio?

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