Hardin, Sutton, and Williams has operated a local business as a partnership for several years. All profits and losses have been allocated in a 3:2:1 ratio, respectively. Recently, Williams has undergone personal financial problems, and is insolvent. To satisfy Williams' creditors, the partnership has decided to liquidate. The following balance sheet has been produced:

cash - 10,000

noncash assets - 227,000

total assets - 237,000

liabilities - 80,000

Hardin, capital - 96,000

Sutton, capital - 45,000

Williams, capital - 16,000

total liabilities and capital - 237,000

During the liquidation process, the following transactions take place: - Noncash assets are sold for $116,000. - Liquidation expenses of $12,000 are paid. No further expenses are expected. - Safe capital distributions are made to the partners. - Payment is made of all business liabilities. - Any deficit capital balances are deemed to be uncollectible.

1. Develop a predistribution plan for this partnership, assuming 12,000 of liquidation expenses are expeced to be paid.

2. compute safe cash payments after the noncash assets have been sold and the liquidation expenses have been paid.