As of January 1, 2021, the partnership of Carlin, Yearly, and Granite had the following account balances and percentages for the sharing of profits and losses:
The partnership incurred losses in recent years and decided to liquidate. The liquidation expenses were expected to be $20,000.How much of the existing cash balance could be distributed safely to partners at this time?
Definitions:
Payable to Cash
A term indicating that a financial instrument, like a check, is written in such a manner that it can be cashed or negotiated by any holder, not just a specific payee.
"Pay to the Order of Bearer"
A phrase used on checks or other negotiable instruments that indicates the person possessing the document has the right to cash or negotiate it.
Drawee
The party, typically a bank, required to pay the specified amount on a check or draft when it is presented for payment.
Negotiable Instrument
A written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer named on the document.
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