This is the last one. I need to pass this class with nothing less than an A. I a

Question

This is the last one. I need to pass this class with nothing less than an A. I am hoping I get some good answers from some of you out there. I have 2 weeks to finish these so please take your time. Thank you.

5. The partnership of Rachel, Adams, and Nixon has the following trial balance on September 30, 2009:



The partners share profits and losses as follows: Rachel, 50 percent; Adams, 30 percent; and Nixon, 20 percent. The partners are considering an offer of $180,000 for the accounts receivable, inventory, and plant and equipment as of September 30. The $180,000 will be paid to creditors and the partners in installments, the number and amounts of which are to be negotiated.

Required:
Prepare a cash distribution plan as of September 30, 2009, showing how much cash each partner will receive if the offer to sell the assets is accepted.

Explanation / Answer

Referring the partners as R,A and N the profit sharing ratio between the partners are5:3:2 total amount receiveable from sale of assets =$180000 since the amount which is to be paid to the creditors are not specified and is yet to be negotiated so assuming the entire amount will be distributed between the partners in their profit sharing ratio, R=$90000 A=$54000 N=$36000 thank you,

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