After liquidating a partnership, what is the total distribution to Cole if their balance sheet included $10,000 cash, $106,000 other assets, and $88,000 liabilities?

After liquidating a partnership, what is the total distribution to Cole if their balance sheet included $10,000 cash, $106,000 other assets, and $88,000 liabilities?

• A. $15,100
• B. $12,900
• C. $21,100
• D. $28,300

Answer: (D)

In liquidation, the amount available to distribute to the partners equals the net assets after settling liabilities. Net assets are found by subtracting total liabilities from total assets. Total assets are 10,000 in cash plus 106,000 in other assets, equaling 116,000. Liabilities total 88,000. Subtracting gives 28,000 for distribution among the partners. If Cole is entitled to the entire remaining amount due to the partnership’s agreement or his share, he would receive 28,000. The 28,300 figure would require an additional adjustment not shown in the given balance sheet data. Based on the numbers provided, the distribution amount is 28,000.

In liquidation, the amount available to distribute to the partners equals the net assets after settling liabilities. Net assets are found by subtracting total liabilities from total assets.

Total assets are 10,000 in cash plus 106,000 in other assets, equaling 116,000. Liabilities total 88,000. Subtracting gives 28,000 for distribution among the partners.

If Cole is entitled to the entire remaining amount due to the partnership’s agreement or his share, he would receive 28,000. The 28,300 figure would require an additional adjustment not shown in the given balance sheet data. Based on the numbers provided, the distribution amount is 28,000.