PARTNERSHIP LIQUIDATION 20.

20. Cash payments may be made in the profit and loss ratio only when the installment payments
have caused the ratio of the partner’s capital account balances to be the same as the profit
I. TRUE OR FALSE and loss ratio.
21. Partnership creditors will be prioritized next to the inside creditors as to the partnership
1. The creditors of the partnership shall have priority in payments over those of the partner’s assets in case of liquidation.
separate creditors as regards the partnership properties. 22. A partner’s interest can be obtained by simply addingthe partner’s capital account, loans to
2. The loss absorption balances represent the maximum loss that the partners could absorb and from the partnership.
without reducing their equity below zero 23. If liquidation of a partnership results in a negative balance in the a partner’s account, the
3. Gains and Losses on the sale of assets in liquidation are divided equally among partners. partners must pay into the partnership the amount of the negative balance.
4. A partnership may be dissolved without being liquidated but liquidation is always preceded 24. The use of safe payments schedule and cash priority program are alternatives which will
by dissolution. yield the same ultimate cash distributions to the partners.
5. A partner's inability to meet his obligations at the time of the liquidation relieves that 25. Partnership liquidation is the same as partnership dissolution.
individual of his liabilities to the other partners. 26. The creditors of the partnership are preferred with respect to the separate or personal
6. A partner’s unrestricted interest represent the portion of a partner’s interest which should properties of the partners.
remain available to absorb possible future losses. 27. The right of offset is the legal right of a partner to apply part or all of his loan account
7. In partnership liquidation, one partner may have to make up for the deficit in another balance against a capital deficiency resulting from losses in the realization of the partnership
partner’s account. assets.
8. When a partnership goes out of business, all the remaining non-cash assets will be declared
as total loss. This loss on liquidation shall be divided among the partners in their profit and II. MULTIPLE CHOICE
loss ratio.
9. Liquidation of a partnership is the winding up of its business activities characterized by sale 28. If a partner is insolvent, his personal properties shall first be distributed
of all non-cash assets, settlement of all liabilities and distribution of the remaining cash to a. to partnership creditors
the partners. b. to the partners by way of additional contributions when the assets of the
10. Partnership creditors shall have priority in payments than those of the partner’s separate partnership were insufficient to settle all obligations
creditors as regards the separate properties of the partners. c. to partnership and separate creditors in the ratio of their loan exposures
11. When cash is insufficient to fully satisfy the cash requirements in a particular priority, then d. to separate creditors
the available cash will be distributed using the profit and loss ratio.
12. The entry to record the exercise of offset will debit the partner’s loan account and credit 29. In a partnership liquidation, the assets of the partnerships shall be applied lastly to
cash. a. those owing to outside creditors
13. A partnership is said to be dissolved when the business is terminated. b. those owing to the partners with respect to their share of the profits
14. Under the installment method of partnerships liquidation, realization of non-cash assets is c. those owing to the partners with respect to their capital contributions
accomplished over an extended period of time. When cash is available, creditors may be d. those owing to inside creditors in the forms of loans or advances for business
partially or fully paid. Any excess may be distributed to partners in accordance with a expenses by the partners
program of safe payments or a cash priority program. This process persists until all the non-
cash assets are sold. 30. Which of the following statements is correct regarding a partner’s capital deficiency?
15. Restricted interests are provided for assumed non-sale of remaining non-cash assets and for a. Partners who absorb another’s capital deficiency have a legal claim against the
assumed insolvency of deficient partners. deficient partner
16. The creditors of each partner shall be preferred to those of the partnership as regards the b. The partner should contribute to reduce the debit balance to the extent possible
partnership property. c. If contributions are not possible, the other partners with credit capital balances will
17. Liquidation of a partnership is the process of ending the business. be allocated a portion of the debit balance
18. The cash settlement of all liabilities is referred to as realization. d. All of these statements are correct
19. In liquidation, partners are given back the assets that they originally invested.
31. The following is the priority sequence in which liquidation process will be distributed for a
partnership:
 a. Partnership liabilities, partnership loans and partnership capital balances c. balances of partners' capital accounts
b. Partnership drawings, partnership liabilities, partnership loans and partnership d. ratio of the capital contributions by partners
capital balances
c. Partnership liabilities, partnership loans, partnership drawings and partnership 38. In liquidation, the liabilities of the partnership should be paid
capital balances a. before any sales of assets
d. Partnership liabilities, partnership capital balances and partnership loans b. before the distribution of cash to partners
c. before the distribution of gains and losses on the disposal of assets
32. Claims against partner’s personal assets by creditors if the partnership can’t pay its debts d. after a revaluation of assets
refers to
a. Liquidation b. Dissolution c. Mutual agency d. Unlimited liability
Partners Matero and Malaya each have a P200,000 capital balance and share profits and losses in a 3:2 ratio,
33. A liquidation differs from a dissolution in that liquidation respectively. Cash equals P 100,000, non-cash assets equal P600,000, and liabilities equal P300,000.
a. assets may be revaluated
b. the business will not continue 39. If the non-cash assets are sold for P350,000, then Matero's capital account will
c. there may be an adjustment of partner’s capital account a. decrease by P105,000 c. decrease by P210,000
d. gains and losses are distributed according to the partnership agreement b. decrease by P150,000 d. decrease by P210,000

34. A partner’s loss absorption balance is calculated by 40. If the non-cash assets are sold for P250,000, each partner is personally insolvent, Malaya
a. dividing the partner’s capital balance by his percentage interest in capital eventually will receive cash of
b. multiplying distributable assets by the partner’s profit sharing percentage a. P0 b. P50,000 c. P60,000 d. P100,000
c. dividing the partner’s total interests by his profit and loss sharing percentage
d. multiplying the partner’s total interests by his profit and loss sharing percentage 41. If the non-cash assets are sold for P225,000, and both partners agreed to make up for any
capital deficits with personal cash contributions, Malaya eventually will receive cash of
35. In accounting for liquidation of a partnership, cash payments to partners after all outside a. P0 b. P25,000 c. P50,000 d. P90,000
creditors' claims have been satisfied, but before final cash distribution, should be according
to Partners Baldecir and Magallanes each have a P300,000 capital balance and share profits and losses in a 3:1
a. relative profit and loss sharing ratios ratio, respectively. Cash equals P100,000, non-cash assets equal P1,000,000, and liabilities equal P500,000.
b. safe payments computations 42. If the non-cash assets are sold for P600,000, then Magallanes' capital account will
c. the final balances in partners' capital accounts a. decrease by P100,000 c. decrease by P200,000
d. the relative share of gain or loss on liquidation b. decrease by P300,000 d. increase by 150,000

36. Which of the following is not correct with respect to an installment liquidation of a 43. If the non-cash assets are sold for P400,000, and both partners agreed to make up for any
partnership? capital deficits with personal cash contributions, Magallanes eventually will receive cash of
a. All remaining liquidation expenses are anticipated a. P0 b. P100,000 c. P150,000 d. P200,000
b. All non-cash assets are assumed to be worthless
c. Distribution to partners are always made according to their profit sharing 44. If the non-cash assets are sold for P500,000, and each partner is personally insolvent,
percentages Magallanes eventually will receive cash of
d. Partners with the greatest ability to absorb losses and expenses are the first to a. P0 b. P100,000 c. P125,000 d. P175,000
receive installment distributions

37. In a partnership liquidation, the final cash distribution to partners should be made in Partners Bioreand Selisana each have a P450,000 capital balance and share profits and losses in a 3:2 ratio,
accordance with the respectively. Cash equals P150,000, non-cash assets equal P1,500,000, and liabilities equal P750,000.
a. safe payments computations
45. If the non-cash assets are sold for P1,000,000, the change in Selisana'scapital account will be
b. partners' profit and loss sharing ratios
 a. an increase of P500,000 c. a decrease of P250,000 50. As of Dec. 31, 2016, the books of AEZ Partnership showed capital balances of Amurao,
b. a decrease of P200,000 d. an increase of P400,000 P40,000; Estoque, P25,000; Zulueta, P5,000. The partner’s profit and loss ratio was 3:2:1,
respectively. The partners decided to liquidate and they sold all non-cash assets for P37,000.
46. If the non-cash assets are sold for P700,000 and each partner is personally insolvent, upon After settlement of all liabilities amounting to P12,000, they still have cash of P28,000 left for
liquidation Selisana will receive a cash distribution of distribution. Assuming that any capital deficiency is uncollectible, the share of Amurao in the
a. P100,000 b. P50,000 c. P130,000 d. P0 distribution of cash would be:
a. P17,000 b. P17,800 c. P18,000 d. P19,000
47. If the non-cash assets are sold for P700,000, and both partners agreed to make up for any
capital deficits with personal cash contributions, upon liquidation Selisana will receive cash 51. Ramos, Seechua and Tria are partners in a textile distribution business, sharing profit and
of losses equally. On Dec. 31, 2015, the partnership capital and the partner’s drawing were as
a. P100,000 b. P50,000 c. P130,000 d. P0 follows:
48. Mactal, Macadang and Pangan are partners with capital balances of P350,000, P250,000 and
P350,0000 and sharing profits 30%, 20% and 50%, respectively. Partners agreed to dissolve Ramos, Capital P100,000 Ramos, Drawing P60,000
the business and upon liquidation, all of the partnership assets are sold and sufficient cash is Seechua, Capital P80,000 Seechua, Drawing P40,000
realized to pay all the claims except one for P50,000. Pangan is personally insolvent, but the Tria, Capital P300,000 Tria, Drawing P20,000
other two partners are able to meet any indebtedness to the firm. On the remaining claim Total Capital P480,000 Total Drawings P120,000
against the partnership, Mactal is to absorb:
a. P15,000 b. P30,000 c. P25,000 d. P40,000 The partnership was unable to collect on its trade receivables, and it was forced to liquidate.
The operating profits for 2015 amounted to P72,000, and was all exhausted including the
49. Partners Ong, Rodriguez, Pamittan and Reyes who share profits and losses at 30%, 30%, 20% partnership assets. Unsettled creditors’ claim at Dec. 31,2016 amounted to P84,000.
and 20%, respectively, decided to liquidate. All partnership assets are to be converted into Seechua and Tria have substantial private resources, but Ramos has no available free assets.
cash. Before liquidation, the condensed statement of financial position follows: The final cash distribution to Tria was:

Cash P100,000
Other Assets 1,800,000
Total Assets P1,900,000 a. P162,000 b. P108,000 c. P84,000 d. P78,000

Liabilities P750,000 52. After operating for five years the books of the partnership of Lopez and Mendez showed the
Rodriguez, Loan 60,000 following balances:
Reyes, Loan 50,000
Ong, Capital 420,000 Net Assets P130,000
Rodriguez, Capital 315,000 Lopez, Capital P85,000
Pamittan, Capital 205,000 Mendez, Capital P45,000
Reyes, Capital 100,000
Total Liabilities and Capital 1,900,000 If liquidation takes place at this point and the net assets are realized at book value, the
partners are entitled to:
The non-cash assets realized P800,000, resulting to a loss of P1,000,000. All the partners are
solvent, and can contribute any additional cash to cover any deficiency in the process of a. Lopez to receive P97,500 and Mendez to receive P32,500
liquidation, deficiencies will occur and will require additional investment as follows: b. Lopez to receive P90,000 and Mendez to receive P40,000
a. Reyes and Pamittan for P50,000 and P7,500, respectively c. Lopez to receive P85,000 and Mendez to receive P45,000
b. Reyes at P50,000 d. Lopez to receive P65,000 and Mendez to receive P65,000
c. Pamittan at P7,500
d. None
53. Garachico, Dugan, Pascua and Cerda are partners, sharing profits in the ratio of 3/21, 4/21, 55. Partners Gumban, Danlag and Escriba who shared profit and losses based on 4:4:2 ratio
6/21, and 8/21, respectively. The balances of their capital accounts on Dec. 31, 2016 are as decided to liquidate. All assets of the partnership were liquidated. The condensed statement
follows: of financial position just prior to liquidation follows:

Garachico P1,000 Dugan P25,000 Pascua P25,000 Cerda P9,000 Cash P100,000
Total Capital P60,000 Other Assets P400,000
Total Assets P500,000
The partners decided to liquidate, and they accordingly converted the non-cash assets into
P23,200 of cash. After paying the liabilities amounting to P3,000, they have P22,200 to Liabilities P140,000
divide. Assume that a debit balance of any partner’s capital is uncollectible. The share of Gumban, Loan P10,000
Garachico in the loss on realization was: Gumban, Capital P45,000
Danlag, Capital P105,000
a. P4,972 b. P5,200 c. P5,257 d. P5,400 Escriba, Capital P200,000
Total Liabilities and Capital P500,000

54. Matias, Pagayanon, and Pescasiosa, partners sharing profits and losses based on 4:4:2 Other assets were sold for P247,500, realizing a loss of P152,500. Parties agreed to fully
decided to liquidate. All assets of the partnership were liquidated. The condensed statement terminate the partnership’s business thus, necessitating distribution of cash to partners and
of financial position just prior to liquidation follows: in the event of capital deficiency, contribution of additional cash. The three partners were all
solvent and could answer any capital deficiency. The realization of assets, distribution of loss
Assets and payment of liabilities resulted to the following partner’s loan and capital accounts
Cash P100,000 balances prior to final cash settlement:
Other Assets P400,000
Total Assets P500,000 a. Gumban, Loan P10,000
Gumban, Capital P10,000
Liabilities and Capital Danlag, Capital P50,000
Liabilities P140,000 Escriba, Capital P165,000
Matias, Loan P10,000 b. Gumban, Loan P10,000
Matias, Capital P45,000 Gumban, Capital P15,000
Pagayanon, Capital P105,000 Danlag, Capital P55,000
Pescasiosa, Capital P200,000 Escriba, Capital P165,000
Total Liabilities and Capital P500,000 c. Gumbag, Loan P10,000
Gumbag, Capital (P16,000)
Other Assets were sold P247,500, realizing a loss of P152,500. Parties agreed to fully Danlag, Capital P44,000
terminate the partnership’s business thus, necessitating distribution of cash to partners and Escriba, Capital P169,500
in case of capital deficiency, contribution of additional cash. The three partners were all d. Gumban, Loan P10,000
solvent and could answer any capital deficiency. Gumban, Capital P45,000
Danlag, Capital P105,000
Name the partner and give the corresponding additional cash he had to invest due to his net Escriba, Capital P200,000
capital deficiency to finally settle the liquidation of the partnership.

a. Matias, P6,0000 c. Matias, P16,000 The assets and equities of the Perdales, Ceballus and Bandonell partnership at the end of its fiscal year ended
b. Pescasiosa, P30,500 d. Pagayanon, P44,000 Oct. 31, 2016 are as follows:

Assets
Cash P15,000 Liabilities P50,000 b. Perdales P0
Ceballus P3,750
Receivable – net P20,000 Loan from Bandonell P10,000 Bandonell P3,750
Inventory P40,000 Perdales, Capital (30%) P45,000 c. Perdales P2,250
Ceballus P3,750
Property and Equipment P70,000 Ceballus, Capital (50%) P30,000 Bandonell P1,500
d. Perdales P2,500
Loan to Ceballus P5,000 Bandonell, Capital (20%) P15,000 Ceballus P2,500
Total Assets P150,000 Total Liabilities and Capital P150,000 Bandonell P2,500

The partners decided to liquidate the partnership. They estimated that the non-cash assets, other than the 59. After all non-cash assets have been converted into cash in the liquidation of the Pozon
loan to Ceballus, can be converted into P100,000 cash over the two-month period ending Dec. 31,2016. Cash andRonzales partnership, the ledger contains the following account balances:
is to be distributed to the appropriate parties as it becomes available during the liquidation process.
Cash P47,000
Accounts Payable P32,000
56. The partner most vulnerable to partnership losses on liquidation is: Loan Payable to Pozon P15,000
a. Perdales b. Bandonell Pozon, Capital P7,000 (Dr)
b. Cebalus b. Ceballus and Perdales equally Ronzales, Capital P7,000

Available cash should be distributed with P32,000 going to accounts payable and
a. P7,000 to Pozon and P8,000 to Ronzales
57. If 65,000 is available for the first distribution, it should be paid to
b. P7,500 each to Pozon and Ronzales
a. Priority Creditors P60,000
c. P8,000 to Pozon and P7,000 to Ronzales
Perdales P5,000
d. P15,000 to the loan payable to Pozon
Ceballus P0
Bandonell P0
60. The condensed statement of financial position is presented for Borromeo, Corpuz, and
b. Priority Creditors P50,000
Dedumo, who share profits and losses in the ratio 4:3:3, respectively:
Perdales P12,000
Ceballus P0
Assets
Bandonell P3,000
Cash P100,000
c. Priority Creditors P60,000
Other Assets P300,000
Perdales P1,500
Total Assets P400,000
Ceballus P2,500
Bandonell P1,000
Liabilities and Capital
d. Priority Creditors P50,000
Liabilities P150,000
Perdales P5,000
Borromeo, Capital P40,000
Ceballus P0
Corpuz, Capital P180,000
Bandonell P10,000
Dedumo, Capital P30,000
Total Liabilities and Capital P400,000
58. If a total amount of P7,500 is available for distribution to partners after all outside liabilities
are paid, it should be paid as follows:
The partners agreed to dissolve the partnership after selling the other assets for P200,000.
a. Perdales P7,500
Upon dissolution of the partnership, Borromeo should have received
Ceballus P0
a. P0 b. P40,000 c. P60,000 d. P70,000
Bandonell P0
61. In a partnership liquidation, the final cash distribution to the partners should be made in Partners Saliut, Villon and Isagan share profits and losses in the ratio 4:5:1. The statement of financial position
accordance with the for the partnership is as follows:
a. ratio of the capital contributions by the partners
b. ratio of the capital contributions less withdrawals by the partners Assets Liabilities and Capital
c. partner’s profit and loss sharing ratio Cash P50,000 Accounts Payable P150,000
d. balances of the partner’s loan and capital accounts
Inventory P360,000 Saliut, Capital P160,000
62. On Jan. 1, 2016, the partners Leung, Ricablanca, and Edulan, who share profits and losses in
the ratio 5:3:2, respectively, decided to liquidate their partnership. On this date the Total Assets P410,000 Villon, Capital P45,000
partnership condensed statement of financial position was as follows: Isagan, Capital P55,000

Assets Total Liabilities and Capital P410,000

Cash P50,000
63. If the inventory is sold for P300,000, how much should Saliut receive upon liquidation of the
Other Assets P250,000
partnership?
Total Assets P300,000
a. P160,000 b. P136,000 c. P100,000 d. P48,000

Liabilities and Capital

Liabilities P60,000 64. If the inventory is sold for P180,000, how much should Isagan receive upon liquidation of the
Leung, Capital P80,000 partnership?
Ricablanca, Capital P90,000 a. P28,000 b. P32,000 c. P37,000 d. P55,000
Edulan, Capital P70,000
Total Liabilities and Capital P300,000 65. The partnership will be liquidated in installments. As cash becomes available, it will be
distributed to the partner. If inventory costing P200,000 is sold for P140,000, how much cash
On Jan. 15, 2016, the first cash sale of other assets with a carrying amount of P150,000 should be distributed to each partner at this time?
realized P120,000. Safe installment payments to the partners were made same date. How
a.Saliut P56,000 b. Saliut P16,000
much cash should be distributed to each partner?
Villon P70,000 Villon P20,000
a. Leung P15,000 Isagan P14,000 Isagan P4,000
Ricablanca P51,000
Edulan P44,000 c. Saliut P32,000 d. Saliut P20,000
b. Leung P40,000 Villon P0 Villon P0
Ricablanca P45,000 Isagan P8,000 Isagan P20,000
Edulan P35,000
c. Leung P55,000
Ricablanca P33,000 66. In accounting for the liquidation of a partnership, cash payments to partners after all non-
Edulan P22,000 partner creditors’ claims have been satisfied, but before the final cash distribution, should be
d. Leung P60,000 according to:
Ricablanca P36,000 a. Safe payment computations
Edulan P24,000 b. The final balances in partner capital accounts
c. The partners’ relative profit and loss sharing ratio
d. The partners’ relative share of the gain and loss on liquidations
 67. Prior to partnership liquidation, a schedule of possible losses is frequently prepared to Ibarra P0
determine the amount of cash that may be safely distributed to the partners. The schedule b. Creditors P170,000
of possible losses Mendoza P10,000
a. indicates the distribution of successive amounts of available cash to each partner Cabredo P0
b. assumes contribution of personal assets by partners unless there is a substantial Ibarra P0
presumption of personal insolvency by the partners. c. Creditors P170,000
c. consists of each partner’s capital account plus loan balance, divided by that Mendoza P0
partner’s profit and loss sharing ratio. Cabredo P0
d. shows the successive losses necessary to eliminate the capital accounts of partners Ibarra P10,000
(assuming no contribution of personal assets by the partners). d. Creditors P170,000
Mendoza P5,000
Cabredo P3,000
The following are based on the Dec. 31, 2015 Statement of Financial Position of the Mendoza, Cabredo and Ibarra P2,000
Ibarra partnership:
70. If cash of P220,000, including the P20,000 cash on hand, becomes available, it should be
Cash P20,000 distributed first to settle the accounts payable and then to
a. Mendoza P25,000
Inventory P120,000 Cabredo P15,000
Property and Equipment, net P300,000 Ibarra P10,000
b. Mendoza P0
Accounts Payable P170,000 Cabredo P26,000
Ibarra P24,000
Mendoza, Capital (50%) P100,000
c. Mendoza P10,000
Cabredo, Capital (30%) P90,000 Cabredo P32,000
Ibarra P8,000
Ibarra, Capital (20%) P80,000 d. Mendoza P0
Cabredo P18,000
On Jan. 1, 2016, the partners decided to liquidate the partnership. They agreed that all cash should be
Ibarra P32,000
distributed as soon as it becomes available. A cash distribution plan is necessary to facilitate the distribution of
cash.
71. Partners Agaton and Valdepenas have capital balances of P15,000 and P12,000, respectively.
They share profits and losses in a 2:1 ratio. They sold all the partnership assets for P60,000,
which resulted to a P6,000 gain on realization. The amount that Valdepenas should receive
68. The distribution plan should be based on relative vulnerability to losses. For the Mendoza, as her share of cash upon liquidation of the partnership is
Cabredo and Ibarra partnership, the relative vulnerability should show that a. P12,000 b. P14,000 c. P20,000 d. P23,000
a. Cabredo is the most vulnerable. c. Cabredo is the least vulnerable.
b. Mendoza is the most vulnerable. d. Mendoza is the least vulnerable.
72. The Tantingco, Mariano and Onate Company decided to liquidate its operations on January 1. The
capital accounts and profit and loss percentage on that date for the three partners are as follows:
69. If cash of P180,000, including the P20,000 cash on hand, becomes available, it should be Tantingco, Capital (20%) P10,000
distributed in accordance with a cash priority plan. How much cash should be distributed to Mariano, Capital (30%) P12,000
the creditors and partners, respectively. Onate, Capital (50%) (P4,000)
a. Creditors P170,000
Mendoza P0
Cabredo P10,000
 Onate is unable to contribute any assets to the partnership to cover her deficit. How much Arzadon, Capital P60,000
cash would be distributed to Tantingcofrom the liquidation? Millado, Capital P40,000
a. P10,000 b. P9,200 c. P8,400 d. P6,000
How much cash shouldArzadon receive?
a. P40,000 b. P50,000 c. P60,000 d. P100,000
73. The process of terminating the business, selling the assets, paying the liabilities and
disbursing remaining cash to the partners is called
a. Withdrawal b. Liquidation c. Dissolution d. Formation of a new partnership 77. The condensed Statement of Financial Position of Ricablanca, Tac-an and Dimalanta
partnership as of March 31, 2016 follows:

74. The condensed Statement of Financial Position is provided for Alvaro and Ampil Company, Assets
immediately prior to its liquidation: Cash P28,000
Non-cash assets P265,000
Assets Total assets P293,000
Cash P100,000
Non-cash Assets P50,000 Liabilities and Capital
Total Assets P150,000 Liabilities P48,000
Ricablanca, Capital P95,000
Liabilities and Capital Tac-an, Capital P80,000
Liabilities P10,000 Dimalanta, Capital P70,000
Alvaro, Capital P50,000 Total liabilities and capital P293,000
Ampil, Capital P90,000
Total Liabilities and Capital P150,000 Profit and loss ratio is 50:25:25, respectively. The partners voted to dissolve the partnership
and liquidate by selling assets in installments. P70,000 was realized on the first cash sale of
If the non-cash assets are sold for P90,000 and Alvaro and Ampil share profits losses equally, other non-cash assets which has a book value of P150,000. After settlement with creditors,
what will be the final cash distribution to Alvaro? all cash available was distributed to partners. How much cash did Dimalanta receive?
a. P50,000 b. P65,000 c. P70,000 d. P95,000 a. P10,500 b. P20,000 c. P32,500 d. P21,250
78. The statement of Financial Position of the partnership of Balino, Andres and Ignacio who
share in the profits and losses in the ratio 5:3:2, respectively, is as follows:
75. Nozuelo, Campillo and Sorio are partners sharing profits and losses equally. The partnership Assets
is being liquidated and after all assets are converted to cash and all liabilities paid, there Cash P30,000
remained P52,000 cash available for distribution to the partners. Nozuelo and Campillo have Other Assets P320,000
capital balances of P40,000 and P30,000, respectively. Sorio has a debit balance of P18,000 Total Assets P350,000
in her capital account. If Sorio is personally insolvent, how much cash will be distributed to
Nozuelo? Liabilities and Capital
a. P26,000 b. P31,000 c. P34,000 d.P40,000 Liabilities P50,000
Balino, Capital P80,000
Andres, Capital P115,000
76. Arzadon and Millado have shared profits and losses equally. Immediately prior to the final Ignacio, Capital P105,000
cash disbursement in the liquidation of their partnership, the books showed. Total Liabilities and Capital P350,000
Cash P 100,000
Liabilities P0
 The partners agreed to liquidate the partnership by installment. Immediately there was a
realization of P100,000 cash in selling other assets with book value of P150,000. On the cash The partnership will be liquidated over a prolonged period of time. As cash is available it will
available, priority is the payment of the liabilities and the balance is to be distributed to the be distributed to the partners. The first sale of non-cash assets having a book value of
partners. How should the remaining cash be distributed? P120,000 realized P90,000. How much cash should be distributed to each partner after this
a. Balino P50,000 sale?
Andres P30,000
Ignacio P20,000 a. Rivera P0
b. Balino P40,000 Colorado P28,800
Andres P24,000 Reyes P41,200
Ignacio P16,000 b. Rivera P0
c. Balino P0 Colorado P30,000
Andres P48,000 Reyes P40,000
Ignacio P32,000 c. Rivera P35,000
d. Balino P0 Colorado P21,000
Andres P31,000 Reyes P14,000
Ignacio P49,000 d. Rivera P45,000
Colorado P27,000
79. Rueda, Castro and Pural have capital balances of P40,000, P50,000, P18,000, respectively Reyes P18,000
and a profit sharing ratio of 4:2:1, respectively. If Rueda received P8,000 upon liquidation,
the total amount received by all the partners was:
a. P108,000 b. P56,000 c. P24,000 d. P52,000 Corleto, Samonte and Bibonia are partners sharing profits and losses in the ratio of 4:3:3, respectively. The
condensed statement of finacial position of CSB Partnership as of Dec. 1, 2016 is:

Assets
80. Assume the facts in No. 79 above except that Rueda received P26,000 as a result of the
liquidation, Pural received as part of the liquidation: Cash P50,000
a. P26,000 b. P18,000 c. P14,500 d. P14,000 Other Assets P130,000

Total Assets P180,000

81. The partnership of Rivera, Colorado and Reyes share profits and losses in the ratio of 5:3:2,
respectively. The partners voted to dissolve the partnership when its assets, liabilities and
capital were as follows: Liabilities and Capital

Assets Liabilities P40,000

Cash P40,000 Corleto, Capital P60,000
Other Assets P210,000
Total Assets P250,000 Samonte, Capital P40,000

Bibonia, Capital P40,000

Liabilities and Capital
Liabilities P60,000 Total Liabilities and Capital P180,000
Rivera, Capital P48,000
Colorado, Capital P72,000
Reyes, Capital P70,000
82. The CSB Partnership was dissolved and liquidated by installments. The first realization of
Total Liabilities and Capital P250,000
P40,000 cash was on sale of other assets with a book value of P80,000. After the payment of
 liabilities, the cash available is distributed to Corleto, Samonte and Bibonia, respectively as As of Dec. 31, 2016, the books of Vicente, Garcia and Cabuyadao Partnership showed capital balances of
follows: Vicente, P40,000; Garcia, P25,000 and Cabuyadao, P5,000. The partners’ profit and loss ratio was 3:2:1,
a. P 36,000; P27,000; P27,000 respectively. The partners decided to dissolve and liquidate. They sold all the non-cash assets for P37,000
b. P16,000; P12,000; P12,000 cash. After settlement of liabilities amounting to P12,000, they still have P28,000 cash left for distribution.
c. P44,000; P28,000; P28,000
d. P24,000; P13,000; P13,000
84. The loss on realization of the non-cash assets was:
The following Statement of Financial Position is presented for the partnership of Villanueva, Pozon and Yecyec a. P42,000 b. P40,000 c. P45,000 d. P21,000
who share profits and losses in the ratio of 5:3:2, respectively.
85. Assuming that any debit balance of partners’ capital is uncollectible, the share of Vicente on
Assets P28,000 cash for distribution was:
a. P19,000 b. P16,000 c. P18,000 d. P17,800
Cash P120,000

Other Assets P1,080,000 From the records of the DTA Partnership, answer nos. 86 to 88:
Total Assets P1,200,000 Assets Liabilities and Capital

Cash P2,000 Liabilities P5,000

Liabilities and Capital Other non-cash assets P28,000 De Mesa, Loan P2,500
Liabilities P280,000 Total Assets P30,000 De Mesa, Capital P12,500
Villanueva, Capital P560,000 Tudtud, Capital P7,000
Pozon, Capital P320,000 Apostol, Capital P3,000
Yecyec, Capital P40,000 Total Liabilities and Capital P30,000
Total Liabilities and Capital P1,200,000 Profit and loss ratio is 3:2:1 for De Mesa, Tudtud and Apostol, respectively. Cash is distributed as assets are
83. Assume that the partners decided to liquidate the partnership. If the other assets were sold realized. Other assets were realized as follows:
for P800,000, how should the available cash be distributed? Date Cash Received Book Value
a. Villanueva P280,000
January 2016 P6,000 P9,000
Pozon P320,000
February 2016 P3,500 P7,700
Yecyec P40,000
March 2016 P12,500 P11,300
b. Villanueva P324,000
Pozon P236,000
Yecyec P16,000 86. The total loss to De Mesa is:
c. Villanueva P412,000 a. P3,000 b. P2,000 c. P1,000 d. 0
Pozon P228,000
Yecyec P0 87. The total cash received by Tudtud is:
d. Villanueva P410,000 a. P2,000 b. P1,500 c. P5,000 d. 0
Pozon P230,000
Yecyec P0 88. Cash received by Apostol in January is:
a. P200 b. P1,000 c. P0 d. P500