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Merz, Dechter, and Flowers are partners in a partnership and share profits and losses 40%, 40%, and 20%, respectively. The partners have agreed to liquidate

Merz, Dechter, and Flowers are partners in a partnership and share profits and losses 40%, 40%, and 20%, respectively. The partners have agreed to liquidate the partnership and anticipate that liquidation expenses will total $14,000. Prior to the liquidation, the partnership balance sheet reflects the following book values:

Cash

$ 25,000

Noncash assets

200,000

Note payable to Dechter

12,000

Other liabilities

165,000

Capital, Merz

40,000

Capital Dechter

18,000

Capital deficit, Flowers

(10,000)

Required:

Assuming that the actual liquidation expenses are $20,000 and that noncash assets are sold for $160,000, determine how the assets will be distributed. Flowers has net personal assets of $10,000.

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