Partnership Liquidation
The following condensed balance sheet is presented for the partnership of Adam, Bob,
and Chris, who share profits and losses in the ratio of 4:3:3, respectively:
Cash
P 160,000
Other assets
320,000
Total
P 480,000
Liabilities
P 180,000
Adam, capital
48,000
Bob, capital
216,000
Chris, capital
36,000
Total
P 480,000
The partners agreed to dissolve the partnership after selling the other assets for
P200,000. Upon the dissolution of the partnership. Adam should have received?
a. P 0
b. 48,000
c. P72,000
d. 84,000
(AICPA)
Answer: (a)
Adam
Bob
P48,000
P216,000
P36,000
4:3:3
(48,000)
(36,000)
(36,000)
Cash received
P
P180,000
Capital balances before liquidation
Chris
Loss on realization (P320,000 – P200,000):
0
P
0
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