Questions 3

Disregarding the marital complications, do you suppose

that the partners would have been able to receive their
proporsional of the equity determined in question 2 if the
partnership was dissolved on March 30, 2010 ? Why ?

Answer :
Liquidation Value Estimation
Assets

Current Statement of Assumed Recovery

Financial Position

Liquidation Value

Cash

$ 1,341

100%

$ 1,341

Account Receivable

$ 870

100%

$ 870

Inventory

$2,430

0%

$0

Prepaid Expense

$833

0%

$0

Caf equipment

$52,155

30%

$15,646

TOTAL

$57,629

$17,857

Based on Liquidation value estimation, their asset will not bring enough cash to pay the
liabilities and partners. On caf equipment, we assume that caf equipment worth 30%
for cash value.
The Partners would not been able to receive their proportional share of the equity.