The Drysdale, Koufax, and Marichal partnership has the following balance sheet immediately prior to liquidation:

Cash	$	46,000	Liabilities	$	45,000
Noncash assets		254,000	Drysdale, loan		30,000
			Drysdale, capital (50%)		85,000
			Koufax, capital (30%)		75,000
			Marichal, capital (20%)		65,000

1. a-1. Determine the maximum loss that can be absorbed in Step 1. Then, assuming that this loss has been incurred, determine the next maximum loss that can be absorbed in Step 2.
2. a-2. Liquidation expenses are estimated to be $25,000. Prepare a predistribution schedule to guide the distribution of cash. Further, modify the tags in explanation as well.
3. b. Assume that assets costing $84,000 are sold for $65,000. How is the available cash to be divided?

Reg A1 ht Req A2 Req B nces Determine the maximum loss that can be absorbed in Step 1. Then, assuming that this next maximum loss that can be absorbed in Step 2. Partner Capital Balance Loss Allocation Maximum Loss That Can Be Absorbed % Step 1 Drysdale Koufax Marichal Step 2 Koufax Marichal % % % % Complete this question by entering your answers in the tabs belo Req A1 Req A2 Req B Liquidation expenses are estimated to be $25,000. Prepare a predistributi Further, modify the tags in explanation as well. DRYSDALE, KOUFAX, AND MARICHAL Distribution of Available Cash Liabilities Liquidation expenses First Next Next % % % All remaining cash % % % Reg A1 Req A2 Req B Assume that assets costing $84,000 are sold for $65,000. How is the available cash to be divided? Cash available for distribution: Beginning cash balance Sale of noncash assets Subtotal Payment of liabilities Payment of estimated liquidation expenses Cash available for distribution Cash distribution to partners: Drysdale Koufax Marichal Total First Next Next Total DAGA