3M Enterprise

January 1, 2015
Cash Priority Program
Balances
Marilou Marah Maribel
1 Profit and Loss Ratio 50% 30% 20%
2 Interest in the Partnership
Capital Balances 50,000 50,000 150,000
Loan Balances 100,000
Total Interest 50,000 150,000 150,000
3 Divide by Profit and Loss Ratio 50% 30% 20%
4 Loss Absorption Capacity 100,000 500,000 750,000
5 Priority 1 -250,000
6 Loss Absorption Balance 100,000 500,000 500,000
7 Priority 2 -400,000
-400,000
8 Loss Absorption Balance 100,000 100,000 100,000
Priority 3 -100,000
-100,000
-100,000
0 0 0

Priority 4 - Amount in excess of

350,00 will be distributed to the
partner's based on their PL Ratio
Enterprise
ry 1, 2015
ority Program
Cash Payment Program
PL Ratio Marilou Marah Maribel
50% 30% 20%

20% 50,000 Priority 1

30% 120,000
Priority 2
20% 80,000

50% 50,000
30% 30,000 Priority 3
20% 20,000
50,000 150,000 150,000
Percent Allocation Total Cash Priority

100% 50,000

60%
200,000
40%

50%
Other Cash
30%
Available
20%
 3M Enterpris
Statement of Liqu
as of June 5, 20

Date Assets
Cash Non - Cash Assets
1 Profit and Loss Ratio
2 Jan 1, 2015 Beginning Balance 100,000 600,000
3 Feb 1, 2015 Collection of A/R 60,000 -72,000
4 Balance 160,000 528,000
5 Payment to External Creditors -160,000
6 Balance 0 528,000
7 Mar 2, 2015 Sale of Non - Cash Assets 245,000 -320,000
8 Balance 245,000 208,000
9 Payment to External Creditors -190,000
10 Balance 55,000 208,000
11 Priority 1 - Full Cash Distribution -50,000
12 Balance 5,000 208,000
13 Priority 2 - Partial Cash Distribution -5,000
14 Balance 0 208,000
15 Apr 3, 2015 Sale of Non - Cash Assets 93,000 -90,000
16 Balance 93,000 118,000
17 Priority 2 - Partial Cash Distribution -93,000
18 Balance 0 118,000
19 May 4, 2015 Sale of Non - Cash Assets 121,000 -106,000
20 Balance 121,000 12,000
21 May 4, 2015 Payment of Liquidation Expense -4,000
22 Balance 117,000 12,000
23 Priority 2 - Final Cash Distribution -102,000
24 Balance 15,000 12,000
25 Priority 3 - Cash Distribution -15,000
26 Balance 0 12,000
27 Jun 5, 2015 Sale of Non - Cash Assets 15,000 -12,000
28 Balance 15,000 0
29 Priority 3 - Cash Distribution -15,000
0 0
 3M Enterprise
Statement of Liquidation
as of June 5, 2015

Liabilities Partner's Equity

Accounts Payable Loan Payable - Marah Marilou Marah Maribel
50% 30% 20%
350,000 100,000 50,000 50,000 150,000
-6,000 -3,600 -2,400
350,000 100,000 44,000 46,400 147,600
-160,000
190,000 100,000 44,000 46,400 147,600
-37,500 -22,500 -15,000
190,000 100,000 6,500 23,900 132,600
-190,000
0 100,000 6,500 23,900 132,600
-50,000
0 100,000 6,500 23,900 82,600
-3,000 -2,000
0 97,000 6,500 23,900 80,600
1,500 900 600
0 97,000 8,000 24,800 81,200
-55,800 -37,200
0 41,200 8,000 24,800 44,000
7,500 4,500 3,000
0 41,200 15,500 29,300 47,000
-2,000 -1,200 -800
0 41,200 13,500 28,100 46,200
-41,200 -20,000 -40,800
0 0 13,500 8,100 5,400
-7,500 -4,500 -3,000
0 0 6,000 3,600 2,400
1,500 900 600
0 0 7,500 4,500 3,000
-7,500 -4,500 -3,000
0 0 0 0 0
Gain/Loss on
realization Events

-12,000 On February 1, 2015, only P60,000 of the accounts receivable were collected. The balance is de

-75,000 On March 2, 2015, the first batch of merchandise inventory worth P320,000 were sold for P245

3,000 On April 3, 2015, the second batch of merchandise inventory costing P90,000 was sold for P93,

15,000 On May 4, 2015, the third batch of merchandise costing P106,000 was sold for P121,000

-4,000 On May 4, 2015, paid all liquidation expenses amounting to P4,000

3,000 On June 5, 2015, sold all property and equipment for P15,000
ected. The balance is deemed uncollectible anymore

000 were sold for P245,000

,000 was sold for P93,000

ld for P121,000
 Journal Entries

Feb 1, 2015 Cash 60,000

Capital, Marilou 6,000
Capital, Marah 3,600
Capital, Maribel 2,400
Allowance for Bad Debts 8,000
Accounts Receivable 80,000
To record collection of AR

Accounts Payable 160,000

Cash 160,000
To record payment to external creditos

Mar 2, 2015 Cash 245,000

Capital, Marilou 37,500
Capital, Marah 22,500
Capital, Maribel 15,000
Merchandise 320,000
To record sale of merchandise

Accounts Payable 190,000

Cash 190,000
To record payment to external creditors

Capital, Maribel 50,000

Cash 50,000
To record cash priority payment to partners (Priority 1)

Loan Payable - Marah 3,000

Capital, Maribel 2,000
Cash 5,000
To record cash priority payment to partners (Priority 2)

Apr 3, 2015 Cash 93,000

Merchandise 90,000
Capital, Marilou 1,500
Capital, Marah 900
Capital, Maribel 600
To record sale of merchandise

Loan Payable - Marah 55,800

Capital, Maribel 37,200
Cash 93,000
To record cash priority payment to partners (Priority 2)
May 4, 2015 Cash 121,000
Merchandise 106,000
Capital, Marilou 7,500
Capital, Marah 4,500
Capital, Maribel 3,000
To record sale of merchandise

Capital, Marilou 2,000

Capital, Marah 1,200
Capital, Maribel 800
Cash 4,000
To record payment for liquidation

Loan Payable - Marah 41,200

Capital, Marah 20,000
Capital, Maribel 40,800
Cash 102,000
To record cash priority payment to partners (Priority 2)

Capital, Marilou 7,500

Capital, Marah 4,500
Capital, Maribel 3,000
Cash 15,000
To record cash priority payment to partners (Priority 3)

Jun 5, 2015 Accumulated Depreciation 134,000

Cash 15,000
Capital, Marilou 1,500
Capital, Marah 900
Capital, Maribel 600
Property and Equipment 146,000
To record sale of Property and Equipment

Capital, Marilou 7,500

Capital, Marah 4,500
Capital, Maribel 3,000
Cash 15,000
To record cash priority payment to partners (Priority 3)
 3M Enterprise
Actual Cash Distribution based on the Cash Prior
as of June 5, 2015
Date Cash Available for Distribution

1 Profit and Loss Ratio

2 Mar 2, 2015 1st CAD 55,000
3 Priority 1 - Full
4 Priority 2 - Partial
5 Apr 3, 2015 2nd CAD 93,000
6 Priority 2 - Partial
7 May 4, 2015 3rd CAD 117,000
8 Priority 2 - Final
9 Priority 3
10 Jun 5 , 2015 4th CAD 15,000
11 Priority 3
Total Cash Distributed to
Partners 280,000
 3M Enterprise
Actual Cash Distribution based on the Cash Priority Program
as of June 5, 2015
Total Cash Priority Payment Actual Payment to Cash Priority Balance
Marilou Marah Maribel
50% 30% 20%

50,000 50,000 0
5,000 3,000 2,000 195,000

55,800 37,200 102,000

61,200 40,800 0
7,500 4,500 3,000

7,500 4,500 3,000 0

15,000 129,000 136,000