The statement of financial position of L, M, and N just before liquidationshows the following:CashP 20,000240,000Non-cash AssetsAccounts PayableN, Loan40,00040,000L, Capital62,000M, Capital88,00030,000N, CapitalL, M, and N share profits and losses in the ratio of 3:2:5, respectively. Thenon-cash assets were sold for P160,000.10.How much cash is available for distribution topartners in settlement of their capital balances?

Name: The statement of financial position of L, M, and N just before liquid
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Description: The statement of financial position of L, M, and N just before liquidationshows the following:CashP 20,000240,000Non-cash AssetsAccounts PayableN, Loan40,00040,000L, Capital62,000M, Capital88,00030,000N, CapitalL, M, and N share profits and losses i

>In the event of dissolution of a partnership, the following steps are taken for payment:[1] Non…

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E The statement of financial position of L, M, and N just before liquidat shows the following Cash P 20,000 240,000 Non-cash Assets Accounts Payable 40,000 N, Loan 40,000 L, Capital 62,000 88,000 M, Capital N, Capital 30,000 L, M, and N share profits and losses in the ratio of 3:2:5, respectively. The non-cash assets were sold for P160,000. How much cash is available for distribution to partners in settlement of their capital balances?

E The statement of financial position of L, M, and N just before liquidat shows the following Cash P 20,000 240,000 Non-cash Assets Accounts Payable 40,000 N, Loan 40,000 L, Capital 62,000 88,000 M, Capital N, Capital 30,000 L, M, and N share profits and losses in the ratio of 3:2:5, respectively. The non-cash assets were sold for P160,000. How much cash is available for distribution to partners in settlement of their capital balances?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The statement of financial position of L, M, and N just before liquidation shows the following:Cash P 20,000 ; Non-cash Assets 240,000 ; Accounts Payable 40,000 ; N, Loan 40,000 ; L, Capital 62,000 ; M, Capital 88,000 ; N, Capital 30,000L, M, and N share profits and losses in the ratio of 3:2:5, respectively. The non-cash assets were sold for P160,000. How much cash is received by N in full settlement of his total interest in the partnership, including loan?
Distressed Corporation is undergoing liquidation. Relevant information as of January 1, 20x1 is shown below:ASSETSCarrying AmountNet Realizable ValueCash P250,000 P300,000Accounts Receivable 150,000 355,649Equipment-net 600,000 200,000Land 1,700,000 1,500,000TOTAL ASSETS P2,700,000 P2,355,649LIABILITIESCarrying AmountSettlement AmountAccounts Payable P1,000,000 P1,000,000Salaries Payable 500,000 500,000Notes Payable 800,000 805,234Loan Payable 800,000 800,000TOTAL LIABILITIES P3,100,000 P3,105,234EQUITYShare Capital P1,600,000Retained Earnings (2,000,000)Capital Deficiency (400,000)TOTAL LIABILITIES & EQUITY P2,700,000Additional Information:• Administrative expenses amounting to P180,744 are expected to be incurred during the liquidation process.• The equipment is pledged to the loan payable.• The land is pledged to the notes payable.QUESTIONS:1. How much are the total free assets? _____________2. How much are the unsecured liabilities with priority? _____________3. How much are…
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