Gar, Mur and Wil were partners, in a firm, sharing profits and losses equally. Their capitals were not equal. There was no partnership deed. The firm dissolved on 30th June 2020. The position was as follows, after dissolution:

Balance Sheet as of June 30, 2020

Liabilities	$	Assets	$
Gear capital a/c	2500	Cash	1916
Mur capital a/c	314	Wil capital a/c	263
Total	2814	Loss on realization Total	635 2814

Wil became insolvent and could not pay anything against the capital deficiency.

Required:

A. Explain the decision that may be taken due to Wils insolvency. Show workings to support your response. (8 marks)

B. In such a case, how the deficiency would be treated by the insolvent partners capital account? (2 marks)

C. Prior to the Garner vs Murrays rule, Mur had raised an objection and claimed that the loss is a capital loss and not a business loss. Therefore, such loss due to capital deficiency of a partner to be borne in capital ratio and not in profit sharing ratio. In court, Mur got the decision in his favor. Explain FOUR (4) points in the Garner vs Murray decision? (10 marks)