Waec Model Questions Vol1 2019 Financial Accounting Question 25

Partners X, Y and Z have capital balances of ₦150,000, ₦100,000 and ₦80,000 respectively and share profit in the ratio 2:1:1. The partnership is being dissolved. The assets and liabilities at the date of dissolution are as follows:\n- Cash on hand: ₦50,000\n- Accounts receivable (collectible): ₦30,000\n- Inventory (cost ₦70,000, market value ₦90,000)\n- Equipment (book value ₦120,000, market value ₦100,000)\n- Outstanding loan: ₦80,000\n- Unpaid salaries: ₦20,000\nThe inventory therefore yields an unrealised gain of ₦20,000 and the equipment an unrealised loss of ₦20,000; these are to be allocated to the partners in the profit‑sharing ratio. In addition, goodwill of ₦60,000 is recognised and is to be shared equally among the partners. Assuming all assets are sold at their market values, compute the amount of cash each partner will receive on dissolution.