Chen korhonen lebuca and swid are partners who share profits...

Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are Chen, capital $ 78,000 Korhonen, capital 32,400 Lebuca, capital 61,000 Swid, capital 25,400 Required: Prepare a predistribution plan to determine which partner will be the first to receive cash from the liquidation and what amount that partner will receive before other partners receive any cash. Note: Amounts to be deducted should be entered with a minus sign. Beginning balances Assumed loss Balances Assumed loss Balances Assumed loss Balances Chen Korhonen Lebuca Swid $ 78,000 $ 32,400 $ 61,000 $ 25,400

Transcript

00:01 So for this question, we have three partners that share income and loss in a 1 to 4 to 5 ratio.

00:11 The partners decide to liquidate the partnership immediately before liquidation.

00:17 The partnership balance sheet shows the total assets of 126 ,000 and total liabilities of 78 ,000.

00:25 It shows each one of their capital and the cash they received.

00:33 From selling, as well as they were able to pay back everything except x amount.

00:42 So here i wrote down their total assets of $126 ,000 total liabilities before the liquidation is $78 ,000 liability towards the creditor.

00:54 So they still owe the creditor $28 ,000.

00:57 They paid everything else but that.

01:00 And the sharing ratio is one to four to five.

01:05 So down here, all i did, all we're going to do is we are going to put in liabilities before liquidation, which is going to be our $78 ,000.

01:27 And then next we're going to put the less cash received from the cell.

01:31 So this is going to be our $78 ,000.

01:35 Thousand minus 28 ,000 so that's going to give us we're going to go minus 50 ,000 and then the remaining liability towards our creditors so we're just going to do our 78 minus our 50 which is going to give us our 28 ,000 then moving on down cash received from the sale of assets so that's going to be our 50 ,000 that we got up here.

02:25 So let's go ahead and add that.

02:31 And the book value, which was just the starting book value, we have to actually subtract that $126 ,000, which is going to give us a loss from the cell is going to be 50.

02:53 Sorry, is going to be our negative.

02:56 The negative represents the loss.

03:00 76 ,000...

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