Scenario 14-2
Assume that a partnership had assets with a book value of $240,000 and a market value of $195,000, outside liabilities of $70,000, loans payable to partner Able of $20,000, and capital balances for partners Able, Baker, and Chapman of $70,000, $30,000, and $50,000.
-Refer to Scenario 14-2. If all outside creditors and loans to partners had been paid, how would the balance of the assets be distributed assuming that Chapman had already received assets with a value of $30,000 assuming profits and losses are allocated equally?

Question

Quizplus · Accepted Answer

After paying outside liabilities and loans to Able, $105,000 remains. Chapman has already received $30,000, leaving $75,000 to be distributed equally among the partners. Each partner receives $25,000, but since Chapman already received $30,000, adjustments are made: Able receives $55,000, Baker $15,000, and Chapman $5,000.

Scenario 14-2 Assume That a Partnership Had Assets with a Book Value