P16-15 Cash Distribution Plan

PET Partnership
Cash Distribution Plan
June 30, 20X1
Loss Absorption Power
Pen

Evan

Capital Accounts

Torves

Pen

Profit and loss

percentages

50%

Preliquidation
capital balances
Loss absorption
Power (Capital
balances /
Loss percent)

Evan

(110,000)

(150,000)

(120,000)

(110,000)

30,000
(120,000)

(120,000)

Decrease highest LAP

to next highest:
Evan
($30,000 x .30)

Decrease LAPs
to next highest:
Evan
($10,000 x .30)
Torves
($10,000 x .20)

30%

(110,000)

20%

(55,000)

(45,000)

(24,000)

(55,000)

9,000
(36,000)

(24,000)

10,000

(110,000)

Torves

3,000
10,000
(110,000)

(55,000)

(33,000)

2,000
(22,000)

Summary of Cash Distribution

(If Offer of $100,000 is Accepted)
Accounts
Payable
Cash available
First
Next
Next
Additional paid
in P&L ratio

$106,000
(17,000)
(9,000)
(5,000)
(75,000)
$
-0-

Pen
50%

Evan
30%

Torves
20%

$ 9,000
3,000

$ 2,000

22,500
$34,500

15,000
$17,000

$17,000

______
$17,000

$37,500
$37,500