Final cash distribution to partners

problem #12 Final Cash Distribution to Partners The partnership of Sarabia, Carpeso and Chavez is about to be liquidated. All the assets have been sold for cash and the creditors have been fully paid. The capital accounts of the partners have the following balances at the date of liquidation: Sarabia Carpeso P600,000 credit Chavez 240,000 debit 360,000 credit The three partners share profits and losses equally. There remains P720,000 cash for distribution to the partners. Required: Determine the manner of distribution of the remaining P720,000 under the following independent assumptions: 1. Carpeso is personally insolvent. He has no personal assets. 2. Carpeso is personally solvent and is willing to contribute additional funds into the partnership to cover his deficit. 3. Carpeso is willing to make additional contributions but his personal assets are not sufficient to accommodate the deficit in his capital account. Only 60% of the deficiency can be covered