Prior to liquidating their partnership, Jacobs and Sanchez had capital accounts of $320,000 and $424,000, respectively. The

Question:

Prior to liquidating their partnership, Jacobs and Sanchez had capital accounts of $320,000 and $424,000, respectively. The partnership assets were sold for $52,000. The partnership had no liabilities. Jacobs and Sanchez share income and losses equally.

a. Determine the amount of Jacobs’s deficiency.

b. Determine the amount distributed to Perez, assuming that Jacobs is unable to satisfy the deficiency.