LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

pls help in accounts - pcc

CA Sourabh Agarwal (Chartered Accountant) (4240 Points)

09 March 2010

pls help me in understanding the concept of piecemeal distribution in partnership

pllssssssss

Reply
Follow
Share

6 Replies

C.Balaji (Learner) (1867 Points)
Replied 09 March 2010

Which book u r referring to????

SIDHARTH DHIR (senior articled assistant) (623 Points)
Replied 10 March 2010

PIECEMEAL DISTRIBUTION.....

When firm is dissolved all assets and liab are realised immediately. But assets may be realised gradually as well because all of them are not liquid..

First payment is made to creditors

Then all other outside liab...

Then partner loan AND THEN PARTNERS.

METHOD 1 RELATIVE SURPLUS CAPITAL METHOD

Q. 3 PARTNERS A B C

PROFIT

SHARINGRATIO 5 3 2

CAPITALS 40000 60000 20000

CALCULATE SURPLUS CAPITAL AND DISTRIBUTION AMONG PARTNERS

I WILL PROVIDE ANSWER WAIT

1 Like

SIDHARTH DHIR (senior articled assistant) (623 Points)
Replied 10 March 2010

A B C

CAPITALS 40000 60000 20000

PSR 5 3 2

DIVIDE IN PSR 8000 20000 10000

TAKE THE MINIMUM CAPITAL SHARE AS BASE

THE MINIMUM IS 8000 I.E A SO A CAPITAL TO

BE TAKEN AS BASE -40000 -24000 -16000

A'S ORIGINAL CAPITAL IS 40000 SO SUBTRACT

>>>>>> A B C

40000 40000*3/5 40000*2/5

(COMPLETE) {PROPORTIONATE) {PROPORTIONATE)

BECAUSE IT IS BASE

EXCESS CAPITAL NIL 36000 4000

NOW C WILL BE MINIMUM

SO HIS BASE WILL BE TAKEN -6000 -4000 (PROPORTIONATE)

EXCESS CAPITAL NIL 30000 NIL

SO IN THIS CASE FIRST 30000 OUT OF REALISED ASSETS WILL BE PAID TO B THEN NEXT 10000 AMONG A AND C IN RATIO 6000 4000 THEN SUBSEQUENT REALISATIONS WILL BE DISTRIBUTED IN 5;3;2

1 Like