Alocal partnership is considering possible liquidation because one of the partners (Bell) is insol¬ vent. Capital balances at the current time are as follows. Profits and losses are divided on a 4:3:2:1 basis, respectively.

1. If a partnership is liquidated, how is the final allocation of business assets made to the partners? LO6

a. Equally.

b. According to the profit and loss ratio.

c. According to the final capital account balances.

d. According to the initial investment made by each of the partners.

Bell, capital Hardy, capital . . . Dennard, capital Suddath, capital .

$50,000 56,000 14,000 80,000 Bell’s creditors have filed a $21,000 claim against the partnership’s assets. The partnership currently holds assets reported at $300,000 and liabilities of $100,000. If the assets can be sold for $190,000, what is the minimum amount that Bell’s creditors would receive?

a. -0-

b. $2,000.

c. $2,800.

d. $6,000.