Law 3102 Pship Distribution Example

Law 3102 Pship Distribution Example - b. B has paid $9,500...

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Distribution Example
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4 basic sets of calculations 1. Net claims due to or from partners, other than for capital and profits Net due from = asset of partnership Net due to = liability of partnership 2. Determine amount of profit or loss +Assets + Net claims due from partners, if any, or - Net claims due to partners, if any - Liabilities to outside creditors - Capital =Profit (Loss) Order of calculations does not matter; not distributing, just calculation
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Calculations (cont.) 3. Determine net due to or from each partner +Capital + Net claim owed from partnership, or - Net claim due to partnership + Share of profits, or - Share of losses = Net due to (Net due from) 4. Make distribution
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Example Capital - A $4,000 B $3,000 C $1,000 Assets = $30,000; due to creditors = $16,000 a. Draws have been taken: A-$3,000;B- 1,500;C-$1,000
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Unformatted text preview: b. B has paid $9,500 to partnership creditor c. Partnership has paid $1,000 for C's tort d. A has paid $2,000 for B's tort 1. Net claims of partners other than for capital, profits A B C Total a. Draws (3,000) (1,500) (1,000) (5,500) b. B pays 9,500 9,500 c. C's tort (1,000) (1,000) d. B's tort 2,000 (2,000) _____ ____0 (1,000) 6,000 (2,000) 3,000 Example (cont.) 2.Profit or loss Assets 30,000-Creditors -16,000 14,000-Net ptr claims 3,000 11,000-Capital 8,000 =Profit 3,000 Example (cont.) 3.Net due to/from partners A B C Total Capital 4,000 3,000 1,000 8,000 Net ptr clms.(1,000) 6,000 (2,000) 3,000 Profit/Loss 1,000 1,000 1,000 3,000 4,000 10,000 0 14,000 4. Distribution Assets 30,000 -To Creditors-16,000 14,000 -To A-4,000 10,000 -To B-10,000...
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This note was uploaded on 12/09/2011 for the course LAW 1101 taught by Professor Reed during the Spring '08 term at CUNY Baruch.

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Law 3102 Pship Distribution Example - b. B has paid $9,500...

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