The balance sheet given below is presented for the partnership of Janet,Anton,and Millet: The partners share profits and losses in the ratio of 5:3:2,respectively.The partners agreed to dissolve the partnership after selling the other assets for $50,000.On dissolution of the partnership,Janet should receive:

Question

The balance sheet given below is presented for the partnership of Janet,Anton,and Millet:  The partners share profits and losses in the ratio of 5:3:2,respectively.The partners agreed to dissolve the partnership after selling the other assets for $50,000.On dissolution of the partnership,Janet should receive:

Quizplus · Accepted Answer

To determine the amount each partner will receive on dissolution of the partnership, we need to first calculate the total assets and liabilities of the partnership:

Total assets = $820,000
Total liabilities = $500,000

Therefore, the total net assets of the partnership are:

Net assets = Total assets - Total liabilities
Net assets = $820,000 - $500,000
Net assets = $320,000

Next, we need to allocate the net assets according to the profit and loss sharing ratio of the partners, which is 5:3:2 for Janet, Anton, and Millet, respectively.

Janet's share = (5/10) x $320,000
Janet's share = $160,000

Anton's share = (3/10) x $320,000
Anton's share = $96,000

Millet's share = (2/10) x $320,000
Millet's share = $64,000

So, after the net assets are distributed, Janet will receive $160,000. However, since the partners agreed to dissolve the partnership after selling the other assets for $50,000, this amount must also be divided according to the profit and loss sharing ratio.

Janet's share = (5/10) x $50,000
Janet's share = $25,000

Adding this amount to Janet's share of the net assets, she will receive a total of $185,000. Therefore, the correct answer is D) $30,000.

The Balance Sheet Given Below Is Presented for the Partnership