How Are the Assets of a Partnership Concern Distributed Upon

Question

Examlex · Accepted Answer

The Answer is The distribution of assets upon the dissolution and winding up of general and limited partnerships is made pursuant to the following rules.
1.Distribution of assets of a general partnership.After a general partnership's assets have been liquidated and reduced to cash,the proceeds are distributed to satisfy claims against the partnership.The ULPA provides the following order of distribution of partnership assets upon the winding up of a general partnership: (1)creditors (except partners who are creditors),(2)creditor-partners,(3)partner's capital contributions,and (4)the remainder of the proceeds.
2.Distribution of assets of a limited partnership.After the assets of a limited partnership have been liquidated,the proceeds must be distributed.The RULPA provides the following order of distribution of partnership assets upon the winding up of a limited partnership: (1)creditors of the limited partnership,including partners who are creditors,(2)partner's capital contributions,and (3)the remainder of the proceeds.
The partners can agree to change the priority of distributions among themselves.After the proceeds are distributed,the partnership automatically terminates.Termination ends the legal existence of the partnership.
If the partnership cannot satisfy its creditors' claims,the general partners of a general partnership and the general partners of a limited partnership are personally liable for the partnership's debts and obligations.

How Are the Assets of a Partnership Concern Distributed Upon

Essay

Correct Answer:
Verified

How Are the Assets of a Partnership Concern Distributed Upon

Essay

Correct Answer:VerifiedShow Answer

Correct Answer:
Verified