Problem Case Number 5

Huey, Duey and Louie are partners with the following

contributions: P 20,000,P30,000 and P 50,000, respectively. On
dissolution, the assets of the partnership amounted to P P
1,000,000. The partnership owes the following amounts to these
creditors : Harry P 100,000; Ronald- P 200,000 and Hermione
P 50,000 and to Louie P 50,000.00. In this particular case,
Louies death caused the dissolution of the partnership

Explain and illustrate how the accounts of the partnership shall

be settled detailing the payment to creditors, the sharing of
profits and the return of contributions if any.
What if in the example given above the liabilities of the
partnership amounted to P 1.5 million, how will the partnership
accounts be settled?

Contribution
Contribution

20000
50000
30000

Huey
Duey
Louie

Computation
Partners

Contribution

Computation

Total/
Percentage

Huey

20 000

20,000/100,000
=P%

0.2 or 20%

Duey

30 000

30
000/100,000=P
%

0.3 or 30%

Louie

50 000

50
000/100,000=P
%

0.5 or 50%

Computation of Profit
1, 000 , 000 = Asset
350, 000 =liabilities
__________________________
650,000
- 50,000 = Partner creditor
__________________________
600,000 = net asset
-100,000= capital
__________________________
500, 000 Profit

Profit
Partners

Computation

Profit

Huey

2/10 x 500,000

100,000

Duey

3/10 x 500,000

150,000

Louie

5/10 x 500,000

250,000 +25,000=
275,000

Total = 275, 000

Liabilities
Harry's share

20,000
50,000
30,000

Huey
Duey
Louie

Liabilities
Ronald's share

40,000
100,000
60,000

Huey
Duey
Louie

Liabilities
Hernoine's share

10,000
25,000
15,000

Huey
Duey
Louie

Liabilities
Hernoine's share

10,000
25,000
15,000

Huey
Duey
Louie

Total Liabilities
Total Liabilities = 400, 000

80,000
200,000
120,000

Huey
Duey
Louie