Question

Write down the order of payments under piecemeal distribution

Answer 1

Answer:

1.The debts of the firm to the third parties (outside liabilities) must be paid first.

2.After the creditors, have been paid off, the amount due to a partners as loan should bepaid. When the loans are due to more than one partner the cash available should bedistributed proportionately.

3.After the payment of outside liabilities and loans due to the partners, the capitals of thepartner are paid.