QUESTION 7 Pazi, Siku and Mwaka had been in partnership as wholesalers sharing profits and losses 1:2:2 respectively. The performance of the business began deteriorating steadily and in early 2014. The partners decided to cease trading on 31 December 2015 and to dispose the assets at the highest prices obtainable on a piecemeal basis. The partners also decided that instead of waiting till all the assets are sold, cash available for partners should be distributed at the end of each month. At the end of the year the balance sheet disclosed: Tshs.('000) Tshs.C000) Capitals - Pazi 60,000 Non current assets (Net) Siku 60,000 Warehouses 120,000 Mwaka 80,000 200,000 Showroom 42,000 Current accounts Vehicles 19,000 181,000 Pazi 10,600 Siku 4.000 Current Assets Mwaka 5,400 20,300 Stocks 76,000 Debtors Loan from Siku 20,000 Bank 20,700 139,700 Other creditors 80,400 320,700 320.700 43,000 5 The following transactions then took place in 2016: February A vehicle that had a book value of Tshs. 5,000,000 was sold for Tshs. 3,000,000. Tshs. 22,500,000 was received from debtors. April All the outstanding debtors, with the exception of a customer who owed Tshs. 500,000, settled their accounts. Stock that had originally cost Tshs. 23,000,000 was sold for Tshs. 27,000,000. June The remaining vehicles were sold for Tshs. 18,000,000. July stock worth 7,000,000 was sold for Tshs.9,100,000 August The remainder of the stock was sold for Tshs. 44,000,000. September The showroom was sold for Tshs. 68,000,000, and the warehouse was sold for Tshs. 200,000,000 Required. Prepare a schedule showing the division of the proceeds between the partners assuming that distributions are made at the end of each month during which amounts become available. Use the maximum loss method