SlideShare a Scribd company logo
The computation of a safe installment payment for the XYZ partnership resulted in only partner
Z receiving cash. Which of the following statements is correct? I. Partner Z lent the partnership
cash, and the partnership had to pay back the loan to Z before distributing cash to X and Y. II.
After assuming all noncash assets were potentially worthless and that assumed capital deficits
created in X's and Y's capital balances were losses to be allocated to Z; Z's capital balance was
the only capital balance left with a credit. (Points : 1) I only II only Either I or II Neither I nor II
Solution
The answer for the above question would be:
II only (Z before distributing cash to X and Y. II. After assuming all noncash assets were
potentially worthless and that assumed capital deficits created in X's and Y's capital
balances were losses to be allocated to Z; Z's capital balance was the only capital balance
left with a credit ).
Explanation for the Answer is provided below:
Under safe installment payment system, cash is paid to the partner, who still has excess credit in
his account at the time of liquidation. Here, Z received all the cash, which means that the amount
of capital deficit in X and Y can be allocated to Z. In other words, the amount of deficit in the
capital accounts of X and Y will be borne by Z.

More Related Content

More from lmark1

The capital budgeting analytical technique that calculates the rate of.docx
The capital budgeting analytical technique that calculates the rate of.docxThe capital budgeting analytical technique that calculates the rate of.docx
The capital budgeting analytical technique that calculates the rate of.docx
lmark1
 
The balance sheet is the cornerstone of the financial statements- The.docx
The balance sheet is the cornerstone of the financial statements- The.docxThe balance sheet is the cornerstone of the financial statements- The.docx
The balance sheet is the cornerstone of the financial statements- The.docx
lmark1
 
The capital account balances for Donald & Hanes LLP on January 1- 2011.docx
The capital account balances for Donald & Hanes LLP on January 1- 2011.docxThe capital account balances for Donald & Hanes LLP on January 1- 2011.docx
The capital account balances for Donald & Hanes LLP on January 1- 2011.docx
lmark1
 
the bookkeeper of vitial inc has asked to assist him with preparation.docx
the bookkeeper of vitial inc has asked to assist him with preparation.docxthe bookkeeper of vitial inc has asked to assist him with preparation.docx
the bookkeeper of vitial inc has asked to assist him with preparation.docx
lmark1
 
The balanced scorecard integrates financial and nonfinancial measures.docx
The balanced scorecard integrates financial and nonfinancial measures.docxThe balanced scorecard integrates financial and nonfinancial measures.docx
The balanced scorecard integrates financial and nonfinancial measures.docx
lmark1
 
The balance sheet for the partnership of Nina- Pinta- and Santa Maria.docx
The balance sheet for the partnership of Nina- Pinta- and Santa Maria.docxThe balance sheet for the partnership of Nina- Pinta- and Santa Maria.docx
The balance sheet for the partnership of Nina- Pinta- and Santa Maria.docx
lmark1
 
Palindromes A palindrome is a word or phrase that reads the same backw (1).docx
Palindromes A palindrome is a word or phrase that reads the same backw (1).docxPalindromes A palindrome is a word or phrase that reads the same backw (1).docx
Palindromes A palindrome is a word or phrase that reads the same backw (1).docx
lmark1
 
Palindromes A palindrome is a word or phrase that reads the same backw (2).docx
Palindromes A palindrome is a word or phrase that reads the same backw (2).docxPalindromes A palindrome is a word or phrase that reads the same backw (2).docx
Palindromes A palindrome is a word or phrase that reads the same backw (2).docx
lmark1
 
Palindromes A palindrome is a word or phrase that reads the same backw.docx
Palindromes A palindrome is a word or phrase that reads the same backw.docxPalindromes A palindrome is a word or phrase that reads the same backw.docx
Palindromes A palindrome is a word or phrase that reads the same backw.docx
lmark1
 
PAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docx
PAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docxPAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docx
PAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docx
lmark1
 
P5- Use the financial information below to calculate and interpret the.docx
P5- Use the financial information below to calculate and interpret the.docxP5- Use the financial information below to calculate and interpret the.docx
P5- Use the financial information below to calculate and interpret the.docx
lmark1
 
Pablo own small transportation firm in Latvia- His trucks delivers goo.docx
Pablo own small transportation firm in Latvia- His trucks delivers goo.docxPablo own small transportation firm in Latvia- His trucks delivers goo.docx
Pablo own small transportation firm in Latvia- His trucks delivers goo.docx
lmark1
 
Over the past weeks we have been examining the inference process- big.docx
Over the past weeks we have been examining the inference process- big.docxOver the past weeks we have been examining the inference process- big.docx
Over the past weeks we have been examining the inference process- big.docx
lmark1
 
Outline the role of the operating system and identify the features of.docx
Outline the role of the operating system and identify the features of.docxOutline the role of the operating system and identify the features of.docx
Outline the role of the operating system and identify the features of.docx
lmark1
 
Outline the key issues involved in Open Systems Theory including the f.docx
Outline the key issues involved in Open Systems Theory including the f.docxOutline the key issues involved in Open Systems Theory including the f.docx
Outline the key issues involved in Open Systems Theory including the f.docx
lmark1
 
Out of the following- which are non separately stated for Neely Inc--.docx
Out of the following- which are non separately stated for Neely Inc--.docxOut of the following- which are non separately stated for Neely Inc--.docx
Out of the following- which are non separately stated for Neely Inc--.docx
lmark1
 
ou shoot a beam of electrons through a double slit to make an interfer.docx
ou shoot a beam of electrons through a double slit to make an interfer.docxou shoot a beam of electrons through a double slit to make an interfer.docx
ou shoot a beam of electrons through a double slit to make an interfer.docx
lmark1
 
OS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docx
OS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docxOS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docx
OS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docx
lmark1
 
Organizational Structure Evaluate the decision-making process and its.docx
Organizational Structure Evaluate the decision-making process and its.docxOrganizational Structure Evaluate the decision-making process and its.docx
Organizational Structure Evaluate the decision-making process and its.docx
lmark1
 
Organizations tend to become less formalized as they age and grow larg.docx
Organizations tend to become less formalized as they age and grow larg.docxOrganizations tend to become less formalized as they age and grow larg.docx
Organizations tend to become less formalized as they age and grow larg.docx
lmark1
 

More from lmark1 (20)

The capital budgeting analytical technique that calculates the rate of.docx
The capital budgeting analytical technique that calculates the rate of.docxThe capital budgeting analytical technique that calculates the rate of.docx
The capital budgeting analytical technique that calculates the rate of.docx
 
The balance sheet is the cornerstone of the financial statements- The.docx
The balance sheet is the cornerstone of the financial statements- The.docxThe balance sheet is the cornerstone of the financial statements- The.docx
The balance sheet is the cornerstone of the financial statements- The.docx
 
The capital account balances for Donald & Hanes LLP on January 1- 2011.docx
The capital account balances for Donald & Hanes LLP on January 1- 2011.docxThe capital account balances for Donald & Hanes LLP on January 1- 2011.docx
The capital account balances for Donald & Hanes LLP on January 1- 2011.docx
 
the bookkeeper of vitial inc has asked to assist him with preparation.docx
the bookkeeper of vitial inc has asked to assist him with preparation.docxthe bookkeeper of vitial inc has asked to assist him with preparation.docx
the bookkeeper of vitial inc has asked to assist him with preparation.docx
 
The balanced scorecard integrates financial and nonfinancial measures.docx
The balanced scorecard integrates financial and nonfinancial measures.docxThe balanced scorecard integrates financial and nonfinancial measures.docx
The balanced scorecard integrates financial and nonfinancial measures.docx
 
The balance sheet for the partnership of Nina- Pinta- and Santa Maria.docx
The balance sheet for the partnership of Nina- Pinta- and Santa Maria.docxThe balance sheet for the partnership of Nina- Pinta- and Santa Maria.docx
The balance sheet for the partnership of Nina- Pinta- and Santa Maria.docx
 
Palindromes A palindrome is a word or phrase that reads the same backw (1).docx
Palindromes A palindrome is a word or phrase that reads the same backw (1).docxPalindromes A palindrome is a word or phrase that reads the same backw (1).docx
Palindromes A palindrome is a word or phrase that reads the same backw (1).docx
 
Palindromes A palindrome is a word or phrase that reads the same backw (2).docx
Palindromes A palindrome is a word or phrase that reads the same backw (2).docxPalindromes A palindrome is a word or phrase that reads the same backw (2).docx
Palindromes A palindrome is a word or phrase that reads the same backw (2).docx
 
Palindromes A palindrome is a word or phrase that reads the same backw.docx
Palindromes A palindrome is a word or phrase that reads the same backw.docxPalindromes A palindrome is a word or phrase that reads the same backw.docx
Palindromes A palindrome is a word or phrase that reads the same backw.docx
 
PAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docx
PAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docxPAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docx
PAD601 Comment in detail on the events of each date 1880- 1881- 1883-.docx
 
P5- Use the financial information below to calculate and interpret the.docx
P5- Use the financial information below to calculate and interpret the.docxP5- Use the financial information below to calculate and interpret the.docx
P5- Use the financial information below to calculate and interpret the.docx
 
Pablo own small transportation firm in Latvia- His trucks delivers goo.docx
Pablo own small transportation firm in Latvia- His trucks delivers goo.docxPablo own small transportation firm in Latvia- His trucks delivers goo.docx
Pablo own small transportation firm in Latvia- His trucks delivers goo.docx
 
Over the past weeks we have been examining the inference process- big.docx
Over the past weeks we have been examining the inference process- big.docxOver the past weeks we have been examining the inference process- big.docx
Over the past weeks we have been examining the inference process- big.docx
 
Outline the role of the operating system and identify the features of.docx
Outline the role of the operating system and identify the features of.docxOutline the role of the operating system and identify the features of.docx
Outline the role of the operating system and identify the features of.docx
 
Outline the key issues involved in Open Systems Theory including the f.docx
Outline the key issues involved in Open Systems Theory including the f.docxOutline the key issues involved in Open Systems Theory including the f.docx
Outline the key issues involved in Open Systems Theory including the f.docx
 
Out of the following- which are non separately stated for Neely Inc--.docx
Out of the following- which are non separately stated for Neely Inc--.docxOut of the following- which are non separately stated for Neely Inc--.docx
Out of the following- which are non separately stated for Neely Inc--.docx
 
ou shoot a beam of electrons through a double slit to make an interfer.docx
ou shoot a beam of electrons through a double slit to make an interfer.docxou shoot a beam of electrons through a double slit to make an interfer.docx
ou shoot a beam of electrons through a double slit to make an interfer.docx
 
OS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docx
OS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docxOS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docx
OS (a) - 5 Points - What is an inode- (b) - 5 Points - How does a soft.docx
 
Organizational Structure Evaluate the decision-making process and its.docx
Organizational Structure Evaluate the decision-making process and its.docxOrganizational Structure Evaluate the decision-making process and its.docx
Organizational Structure Evaluate the decision-making process and its.docx
 
Organizations tend to become less formalized as they age and grow larg.docx
Organizations tend to become less formalized as they age and grow larg.docxOrganizations tend to become less formalized as they age and grow larg.docx
Organizations tend to become less formalized as they age and grow larg.docx
 

Recently uploaded

RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3
RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3
RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3
IreneSebastianRueco1
 
Community pharmacy- Social and preventive pharmacy UNIT 5
Community pharmacy- Social and preventive pharmacy UNIT 5Community pharmacy- Social and preventive pharmacy UNIT 5
Community pharmacy- Social and preventive pharmacy UNIT 5
sayalidalavi006
 
clinical examination of hip joint (1).pdf
clinical examination of hip joint (1).pdfclinical examination of hip joint (1).pdf
clinical examination of hip joint (1).pdf
Priyankaranawat4
 
PCOS corelations and management through Ayurveda.
PCOS corelations and management through Ayurveda.PCOS corelations and management through Ayurveda.
PCOS corelations and management through Ayurveda.
Dr. Shivangi Singh Parihar
 
Walmart Business+ and Spark Good for Nonprofits.pdf
Walmart Business+ and Spark Good for Nonprofits.pdfWalmart Business+ and Spark Good for Nonprofits.pdf
Walmart Business+ and Spark Good for Nonprofits.pdf
TechSoup
 
What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...
What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...
What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...
GeorgeMilliken2
 
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UPLAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
RAHUL
 
Pride Month Slides 2024 David Douglas School District
Pride Month Slides 2024 David Douglas School DistrictPride Month Slides 2024 David Douglas School District
Pride Month Slides 2024 David Douglas School District
David Douglas School District
 
Pengantar Penggunaan Flutter - Dart programming language1.pptx
Pengantar Penggunaan Flutter - Dart programming language1.pptxPengantar Penggunaan Flutter - Dart programming language1.pptx
Pengantar Penggunaan Flutter - Dart programming language1.pptx
Fajar Baskoro
 
How to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 InventoryHow to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 Inventory
Celine George
 
Cognitive Development Adolescence Psychology
Cognitive Development Adolescence PsychologyCognitive Development Adolescence Psychology
Cognitive Development Adolescence Psychology
paigestewart1632
 
C1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptx
C1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptxC1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptx
C1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptx
mulvey2
 
Film vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movieFilm vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movie
Nicholas Montgomery
 
A Independência da América Espanhola LAPBOOK.pdf
A Independência da América Espanhola LAPBOOK.pdfA Independência da América Espanhola LAPBOOK.pdf
A Independência da América Espanhola LAPBOOK.pdf
Jean Carlos Nunes Paixão
 
How to Make a Field Mandatory in Odoo 17
How to Make a Field Mandatory in Odoo 17How to Make a Field Mandatory in Odoo 17
How to Make a Field Mandatory in Odoo 17
Celine George
 
BBR 2024 Summer Sessions Interview Training
BBR  2024 Summer Sessions Interview TrainingBBR  2024 Summer Sessions Interview Training
BBR 2024 Summer Sessions Interview Training
Katrina Pritchard
 
Your Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective UpskillingYour Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective Upskilling
Excellence Foundation for South Sudan
 
Chapter 4 - Islamic Financial Institutions in Malaysia.pptx
Chapter 4 - Islamic Financial Institutions in Malaysia.pptxChapter 4 - Islamic Financial Institutions in Malaysia.pptx
Chapter 4 - Islamic Financial Institutions in Malaysia.pptx
Mohd Adib Abd Muin, Senior Lecturer at Universiti Utara Malaysia
 
The Diamonds of 2023-2024 in the IGRA collection
The Diamonds of 2023-2024 in the IGRA collectionThe Diamonds of 2023-2024 in the IGRA collection
The Diamonds of 2023-2024 in the IGRA collection
Israel Genealogy Research Association
 
Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...
Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...
Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...
National Information Standards Organization (NISO)
 

Recently uploaded (20)

RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3
RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3
RPMS TEMPLATE FOR SCHOOL YEAR 2023-2024 FOR TEACHER 1 TO TEACHER 3
 
Community pharmacy- Social and preventive pharmacy UNIT 5
Community pharmacy- Social and preventive pharmacy UNIT 5Community pharmacy- Social and preventive pharmacy UNIT 5
Community pharmacy- Social and preventive pharmacy UNIT 5
 
clinical examination of hip joint (1).pdf
clinical examination of hip joint (1).pdfclinical examination of hip joint (1).pdf
clinical examination of hip joint (1).pdf
 
PCOS corelations and management through Ayurveda.
PCOS corelations and management through Ayurveda.PCOS corelations and management through Ayurveda.
PCOS corelations and management through Ayurveda.
 
Walmart Business+ and Spark Good for Nonprofits.pdf
Walmart Business+ and Spark Good for Nonprofits.pdfWalmart Business+ and Spark Good for Nonprofits.pdf
Walmart Business+ and Spark Good for Nonprofits.pdf
 
What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...
What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...
What is Digital Literacy? A guest blog from Andy McLaughlin, University of Ab...
 
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UPLAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
LAND USE LAND COVER AND NDVI OF MIRZAPUR DISTRICT, UP
 
Pride Month Slides 2024 David Douglas School District
Pride Month Slides 2024 David Douglas School DistrictPride Month Slides 2024 David Douglas School District
Pride Month Slides 2024 David Douglas School District
 
Pengantar Penggunaan Flutter - Dart programming language1.pptx
Pengantar Penggunaan Flutter - Dart programming language1.pptxPengantar Penggunaan Flutter - Dart programming language1.pptx
Pengantar Penggunaan Flutter - Dart programming language1.pptx
 
How to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 InventoryHow to Setup Warehouse & Location in Odoo 17 Inventory
How to Setup Warehouse & Location in Odoo 17 Inventory
 
Cognitive Development Adolescence Psychology
Cognitive Development Adolescence PsychologyCognitive Development Adolescence Psychology
Cognitive Development Adolescence Psychology
 
C1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptx
C1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptxC1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptx
C1 Rubenstein AP HuG xxxxxxxxxxxxxx.pptx
 
Film vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movieFilm vocab for eal 3 students: Australia the movie
Film vocab for eal 3 students: Australia the movie
 
A Independência da América Espanhola LAPBOOK.pdf
A Independência da América Espanhola LAPBOOK.pdfA Independência da América Espanhola LAPBOOK.pdf
A Independência da América Espanhola LAPBOOK.pdf
 
How to Make a Field Mandatory in Odoo 17
How to Make a Field Mandatory in Odoo 17How to Make a Field Mandatory in Odoo 17
How to Make a Field Mandatory in Odoo 17
 
BBR 2024 Summer Sessions Interview Training
BBR  2024 Summer Sessions Interview TrainingBBR  2024 Summer Sessions Interview Training
BBR 2024 Summer Sessions Interview Training
 
Your Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective UpskillingYour Skill Boost Masterclass: Strategies for Effective Upskilling
Your Skill Boost Masterclass: Strategies for Effective Upskilling
 
Chapter 4 - Islamic Financial Institutions in Malaysia.pptx
Chapter 4 - Islamic Financial Institutions in Malaysia.pptxChapter 4 - Islamic Financial Institutions in Malaysia.pptx
Chapter 4 - Islamic Financial Institutions in Malaysia.pptx
 
The Diamonds of 2023-2024 in the IGRA collection
The Diamonds of 2023-2024 in the IGRA collectionThe Diamonds of 2023-2024 in the IGRA collection
The Diamonds of 2023-2024 in the IGRA collection
 
Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...
Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...
Pollock and Snow "DEIA in the Scholarly Landscape, Session One: Setting Expec...
 

The computation of a safe installment payment for the XYZ partnership.docx

  • 1. The computation of a safe installment payment for the XYZ partnership resulted in only partner Z receiving cash. Which of the following statements is correct? I. Partner Z lent the partnership cash, and the partnership had to pay back the loan to Z before distributing cash to X and Y. II. After assuming all noncash assets were potentially worthless and that assumed capital deficits created in X's and Y's capital balances were losses to be allocated to Z; Z's capital balance was the only capital balance left with a credit. (Points : 1) I only II only Either I or II Neither I nor II Solution The answer for the above question would be: II only (Z before distributing cash to X and Y. II. After assuming all noncash assets were potentially worthless and that assumed capital deficits created in X's and Y's capital balances were losses to be allocated to Z; Z's capital balance was the only capital balance left with a credit ). Explanation for the Answer is provided below: Under safe installment payment system, cash is paid to the partner, who still has excess credit in his account at the time of liquidation. Here, Z received all the cash, which means that the amount of capital deficit in X and Y can be allocated to Z. In other words, the amount of deficit in the capital accounts of X and Y will be borne by Z.