Question

Inlcuded in Perry's capital balance is a $20,000 partnership loan owed to Perry. Perry, Quincy, and Renquist shared profits and losses in a ratio of 2:4:4. Liquidation expenses were expected to be $15,000. All partners were solvent. What would be the minimum amount for which the noncash assets must have been sold, in order for Quincy to receive some cash from the liquidation?

Answer 1

Answer:

Determine the minimum amount for which the non-cash assets must have been sold, in order for quincy to receive some cash from the liquidation:

Total non-cash assets = 300,000

Less: Balance needed from non-cash assets = 95,000

($90,000 - $15,000 - $170,000)

Adjusted non-cash assets = 205,000

Less: Liquidation expenses = 15,000

Balance of non-cash assets  = 190,000

Hence, the the minimum amount for which the non-cash assets must have been sold, in order for quincy to receive some cash from the liquidation would be any amount in excess of $190,000.