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A local partnership is considering possible liquidation because one of the partners (Bell) is insolvent. Capital balances at the current time are as follows. Profits and losses are divided on a 4:3:2:1 basis, respectively.
Bell, Capital $86,000
Hardy, Capital $70,000
Dennard, Capital $20,000
Suddath, Capital $94,000
Bell's creditors have filed a $35,000 claim against the partnership's assets. The partnership currently holds assets reported at $440,000 and liabilities of $240,000. If the assets can be sold for $260,000, what is the minimum amount that Bell's creditors would receive?

Note to tutor: I'm having trouble spliting the potential loss of $16,000 from Dennard 4:3:1 Along with answering the question please explain in detail how this is split

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Accounting Basics, Accounting

Category:- Accounting Basics
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