Frescoand Garcia form a partnership—HVAC Pros. Garcia's capital contribution is $10,000, and Fresco'sis $15,000. The partnership agreement provides that profits are to be shared, with 40 percent for Garcia and 60 percent for Fresco. Later, Garcia
makes a $10,000 loan to the partnership when it needs working capital. When the partnership is dissolved, its assets are $50,000, and its debts are $8,000. How should the assets be distributed?
On the dissolution and winding up of a partnership, the or¬der of liability payment of the assets is as follows: (a) debts owed to part¬nership creditors, including partners; and (b) capital contributions of partners and profits as provided or, in the absence of an agreement, equally [UPA 807].
In this question, the partnership's creditors would be paid $8,000 first, leaving a balance of $42,000 from the $50,000. Next, Garcia would be paid $10,000 for the loan, or advance, leaving $32,000. From this amount, Garcia would receive $10,000 and Fresco$15,000 as pay¬ment for their capital contributions, leaving a bal¬ance of $7,000. The $7,000 would be split as profits, with 40 percent going to Garcia ($2,800) and 60 percent to Fresco($4,200).
You might also like to view...
According to Michael Porter, which of the following is a narrow market strategy for creating competitive advantage?
A) vertical integration B) horizontal integration C) cost leadership D) focused differentiation
The first step in the social marketing planning process is ________
A) determining the focus of the program B) selecting the target audience C) setting objectives and goals D) designing the market offering E) finding a source of funding
Anita is a store manager who wants no employee input when she is making decisions about how the store should be operated. She prefers to make all the decisions by herself. What kind of a manager is Anita?
A. Democratic manager B. Persuasive manager C. Transformational manager D. Chaotic manager E. Autocratic manager
The four dimensions of the BrandAsset Valuator are differentiation, relevance, knowledge, and ________.
Fill in the blank(s) with the appropriate word(s).