4.
Refer to the above information. Assume the receivables and the fixed assets were sold for $380,000 and
that all available cash, except for $40,000 which is being held back for possible future liquidation costs,
was distributed to the partners. How much cash should be distributed to B?
A. $108,000
B. $ 48,000
C. $ 36,000
D. $ 20,000
5.
Refer to the above information. For K to receive $32,000 from the liquidation process, how much cash
must be realized from the sale of all of the noncash assets?
A. $820,000
B. $650,000
C. $500,000
D. $480,000
6.
Refer to the above information. If the noncash assets were sold for $340,000, how much cash would go to
T?
A. $96,000
B. $86,400
C. $80,000
D. $ 0
7.
The capital balances, prior to the liquidation of the XYZ partnership, were as follows:
X, Y, and Z share profits and losses in the ratio of 5:3:2. As a result of a loan, the partnership owes Y
$80,000. Using the information above, which partner has the highest Loss Absorption Power (LAP) prior to
liquidation?
A. X
B. Y
C. Z
D. X and Y have the same LAP
8.
In the computation of a partner's Loss Absorption Power (LAP), the individual partner's net capital balance
and profit-and-loss percentage are used in which of the following ways?
A.
B.
C.
D.