1. Harriet, Mickey, and Zack decide to liquidate their partnership. All assets are sold for cash and all the liabilities are paid. After this, their capital balances are: Harriet - $27,000; Mickey - ($12,000); Zack - $43,000. Their profit/loss percentages are: Harriet - 30%; Mickey - 40%; Zack - 30%. Mickey is unable to contribute any assets to reduce his deficit. How much cash will Harriet receive as a result of the partnership liquidation?

1. $15,000
2. $21,000
3. $23,400
4. $27,000

2. How is the remaining cash of a partnership ( after all creditors have been paid ) divided among partners upon liquidation?

1. According to their capital balances
2. According to their contribution of assets
3. According to their withdrawal account balances
4. According to their profit/loss ratio

3. Bobbi and Stuart are partners. Bobbis capital balance is $40,000 and Stuarts capital balance is $70,000. Bobbi sells her interest in the partnership to John for $50,000. The journal entry to record the admission of John as a new partner would include:

1. A credit to Johns capital account for $40,000
2. A credit to Johns capital account for $50,000
3. A credit to Johns capital account for $40,000 and a credit to Stuarts capital account for $10,000
4. A credit to Stuarts capital for $10,000

4. Partners Ken and Macki each have a capital balance of $40,000 and share profit/loss in a 3:2 ratio. Cash equals $20,000, noncash assets equal $120,000, and liabilities equal $60,000. They decide to liquidate the partnership and the noncash assets are sold for $60,000. Both partners agree to make up any capital deficits with personal cash contributions. How much cash will Macki receive as a result of the liquidation?

1. $0
2. $4,000
3. $16,000
4. $24,000

5. ABC Company, a private company, decides to lease new manufacturing equipment. The lease qualifies as a capital lease under ASPE. The lease transaction will be recorded at:

1. The fair market value of the leased equipment
2. The present value of the lease payments
3. The higher of the fair market value of the leased equipment and the present value of the lease payments
4. The lower of the fair market value of the leased equipment and the present value of the lease payments