The Balance Sheet of Ryan,James and Peter's Partnership as of December

question 137

Multiple Choice

The balance sheet of Ryan,James and Peter's partnership as of December 31,2018,is given below. Ryan,Peter,and James share profits 3:2:1.They liquidate the partnership.The furniture and equipment
Are sold at a $8000 loss.The accounts receivable were collected in full and the other assets were
Written off as worthless.The liabilities were paid off at book value.James argued that he should
Receive a portion of the remaining cash,but Ryan and Peter disagree.How much cash should James
Receive or pay?

• A)He should receive $1500.
• B)He should not receive or pay any money.
• C)He should pay $55,500.
• D)He should pay $500.

---

Definitions:

P-value

The chance of witnessing outcomes in a test that are as or more extreme than what was actually seen, assuming that the null hypothesis is true.

Significance Level

A threshold set by researchers in hypothesis testing that determines the probability of rejecting a true null hypothesis, often denoted by alpha (α).

Rejection Region

The region in the sampling distribution of a statistic that leads to the rejection of the null hypothesis.

Test Statistic

A value calculated from sample data during a hypothesis test, used to decide whether to reject the null hypothesis.