Before Liquidating Any Assets, the Partners Determined the Amount of Cash

question 66

Multiple Choice

Before liquidating any assets, the partners determined the amount of cash available for safe payments.How should the amount of safe cash payments be distributed?

• A) In a ratio of 2:4:4 among all the partners.
• B) $18,333 to Henry and $16,667 to Jacobs.
• C) In a ratio of 1:2 between Henry and Jacobs.
• D) $15,000 to Henry and $10,000 to Jacobs.
• E) $21,667 to Henry and $3,333 to Jacobs.

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Definitions:

Net Income

The amount of earnings left over after all expenses and taxes have been deducted from total revenue.

Revenue

The total amount of money received by a company for goods sold or services provided during a certain time period.

Break-Even Point

The break-even point is the point at which total costs and total revenues are equal, meaning there is no net loss or gain.

Variable Costs

Costs that vary depending on the level of production or sales.