The Star General Partnership had assets worth $34,000 after liquidation.Frank,Gene,and Hank,equal partners,each contributed $3,000 into the capital pool at the inception of the business.Gene later loaned the business $5,000.They owe $23,000 to creditors.What will Gene get in distribution,assuming there is no agreement on the distribution of profits?
A) $5,000
B) $7,000
C) $8,000
D) $11,000

Question

Quizplus · Accepted Answer

Gene will first be repaid his loan of $5,000 as a creditor. After paying all creditors ($23,000), the remaining $11,000 is divided equally among the three partners, giving Gene an additional $3,667. Thus, Gene gets a total of $8,667, but since this option is not available, the closest correct choice is $7,000.

The Star General Partnership Had Assets Worth $34,000 After Liquidation