Asked by Trap muzik Blossom on Jun 24, 2024
Verified
In the liquidating process, any uncollected cash becomes a loss to the partnership and is divided among the remaining partners' capital balances based on their income-sharing ratio.
Uncollected Cash
Money owed to a business or individual that has not yet been received or collected.
Income-Sharing Ratio
This ratio determines how profits or losses are distributed among partners or stakeholders in a business or investment venture.
Remaining Partners
This term refers to the partners who continue to remain in a partnership arrangement after a partner exits or the partnership undergoes some changes.
- Master the concept of ending a partnership, with special attention to the methods of disbursing cash and the obligations of partners concerning capital balance deficits.
Verified Answer
LC
Lauren CantrellJun 25, 2024
Final Answer :
True
Explanation :
This statement is true. When a partnership is liquidated, any uncollected cash is considered a loss to the partnership and is divided among the remaining partners based on their income-sharing ratio. This is because the partners share both the profits and losses of the partnership according to their agreed-upon ratio.
Learning Objectives
- Master the concept of ending a partnership, with special attention to the methods of disbursing cash and the obligations of partners concerning capital balance deficits.