Case Study

Lone Pine Cafe.

Presented by
Preety Rateria
Nipun Goel
Venkat raman
T.Kedar
Mahesh

Capital 48000
Mr. Henry Antoine 16000
Mrs. Henry Antoine 16000
Mrs. Sandra Landers 16000

Secured Loan nil

Unsecured Loan 21000

Creditors and provisions nil
Fixed assets
Equipment 53200

Investments nil

Current assets, loans & advances
Food and beverages
2800
Checking A/c 10172
Prepaid license fees 1428
Cash Register 1400


69000
69000
Balance Sheet for the Lone Pine Cafe as of November 2, 2005.
Working notes:
1) Unsecured loan as on 31.3.2006
opening amt. = 21000
(-) amt. Repaid = 2100
o/s amt. = 18900

2)Prepaid license fees as on 31.3.2006
Amount payable per years is Rs 1428 as on 1
st
November.
(-) Amount expired on 31.3.2006 = 1428/12*5
= 595
Amount o/s on 31.3.2006 = 833

3) The amount of Capital as on 31.3.06 is the balance figure and has
been distributed among the partners in equal ratio.
4) The cash register and its contents were taken away :
Loss by theft dr 1711
To cash 311
To cash register 1400

The ski instructors who owed Rs 870 paid subsequently, so cash
balance is Rs 870



Capital (bal. figure) (note) 35435
Mr. Henry Antoine 11811
Mrs. Henry Antoine 11811
Mrs. Sandra Landers 11812

Secured Loan nil

Unsecured Loan(note) 18900

Creditors and provisions
Creditors 1583

Fixed assets
Equipment 53200
(-)depreciation 2445 50755

Investments nil

Current assets, loans & advances
Cash (note) 870
Checking A/c 1030
Food and beverages 2430

Prepaid license fees (note) 833


Miscellaneous expenses nil




55918
Balance Sheet for the Lone Pine Cafe as of March 30, 2006.
55918
If the Partnership was dissoved on 31.3.2006,
disregarding the marital complications, the
surplus left after selling the assets of the firm
and paying of the liabilities amounted to
Rs 34876 .


The partners would have been able to receive
the same in proportion of there equity because
in the event of dissolution of a partner-ship firm,
the surplus realised is divided among the
partners

Working note
Food & beverages a/c
Bal. b/d 2800
Creditors 1583
Cash 10016


14399
Profit/loss (bal.fig) 11969
Bal. c/d 2430



14399

Income Statement of Lone Pine Cafe for the year ended 30
th
March
2006
Sales 43480
Less
Food and beverages 11969
Wages 5480
Interest 540
Telephone and electricity 3270
Miscellaneous 255
Rent 7500
License 595
Depreciation 2445
Loss by theft 1711
Payment to partners 23150

Loss during the year (bal. Figure) (13435)


Income Statement of Lone Pine Cafe for the year ended 30
th
March
2006
Sales 43480
Less
Expenses 33765
Profit 9715
(-)Payment to partners 23150

Loss during the year (bal. Figure) (13435)




So it tells Mrs Antoine about the income position of the firm.
And that the firm is running into losses if we consider the
payments to the partners.
But even if she was to carry on as a sole proprietory she will
have to appoint managers and pay salary to the say. So it does
not seem a good idea to carry on with the cafe.