Question
The partnership of Peter, Paul, and Mary share profits and losses in the ratio of 4:4:2,...
The partnership of Peter, Paul, and Mary share profits and losses in the ratio of 4:4:2, respectively. The partners voted to dissolve the partnership when its assets, liabilities, and capital were as follows:
|
Assets |
||
| Cash | $250,000 | |
| Other assets | 1,000,000 | |
| $1,250,000 | ||
|
Liabilities and Capital |
||
| Liabilities | $200,000 | |
| Peter, Capital | 300,000 | |
| Paul, Capital | 350,000 | |
| Mary, Capital | 400,000 | |
| $1,250,000 | ||
The partnership will be liquidated over a prolonged pe
riod of time. As cash is available, it will be distributed to the partners. The first sale of noncash assets having a book value of $600,000 realized $475,000. How much cash should be distributed to each partner after this sale?
|
Peter, $90,000; Paul, $140,000; Mary, $295,000 |
|
Peter, $210,000; Paul, $290,000; Mary, $145,000 |
|
Peter, $150,000; Paul, $175,000; Mary, $200,000 |
|
Peter, $290,000; Paul, $210,000; Mary, $105,000 |
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