The partnership of Butler, Osman, and Ward was formed several years ago as a local tax preparation firm. Two partners have reached retirement age, and the partners have decided to terminate operations and liquidate the business. Liquidation expenses of $59,000 are expected. The partnership balance sheet at the start of liquidation is as follows:

Cash	$	55,000		Liabilities	$	195,000
Accounts receivable		85,000		Butler, loan		55,000
Office equipment (net)		75,000		Butler, capital (25%)		175,000
Building (net)		235,000		Osman, capital (25%)		55,000
Land		225,000		Ward, capital (50%)		195,000
Total assets	$	675,000		Total liabilities and capital	$	675,000
The following transactions transpire in chronological order during the liquidation of the partnership: Collected 90 percent of the accounts receivable and wrote the remainder off as uncollectible. Sold the office equipment for $32,500, the building for $178,000, and the land for $220,000. Distributed safe payments of cash. Paid all liabilities in full. Paid actual liquidation expenses of $42,500 only. Made final cash distributions to the partners. Distributed safe payments of cash.