After the accounts are closed on May 3, 2006, prior to liquidating the partnership, the capital accounts

Question:

After the accounts are closed on May 3, 2006, prior to liquidating the the capital accounts of Ann Booth, Harold Owen, and Carla Ramariz are $20,000, $3,900, and $10,000, respectively. Cash and noncash assets total $1,900 and $62,000, respectively. Amounts owed to creditors total $30,000. The partners share income and losses in the ratio of 2:1:1. Between May 3 and May 29, the noncash assets are sold for $26,000, the partner with the capital deficiency pays his deficiency to the and the liabilities are paid.

Instructions
1. Prepare a statement of liquidation, indicating
(a) The sale of assets and division of loss,
(b) The receipt of the deficiency (from the appropriate partner),
(c) The payment of liabilities,
(d) The of cash.
2. If the partner with the capital deficiency declares bankruptcy and is unable to pay the deficiency, explain how the deficiency would be divided between the partners.

Distribution
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most... Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...