The partnership of Winn, Xie, Yang, and Zed has the following balance sheet:

Cash	$	47,000	Liabilities	$	56,000
Other assets		295,000	Winn, capital (50% of profits and losses)		77,000
			Xie, capital (30%)		105,000
			Yang, capital (10%)		57,000
			Zed, capital (10%)		47,000

Zed is personally insolvent, and one of his creditors is considering suing the partnership for the $4,000 that is currently owed. The creditor realizes that this litigation could result in partnership liquidation and does not wish to force such an extreme action unless Zed is reasonably sure of obtaining at least $4,000 from the liquidation.

Prepare a predistribution plan to determine the amount for which the partnership must sell the other assets to ensure that Zed receives $4,000 from the liquidation. Liquidation expenses are expected to be $32,000.

	Winn	Xie	Yang	Zed
Beginning capital	$77,000	$105,000	$57,000	$47,000
Assumed loss of Schedule 1	$(77,000)
Step one balances	$0		57000	47000
Assumed loss of Schedule 2
Step two balances	$0	$0	57000	$47000
Assumed loss of Schedule 3
Step three balances	$0	105000	57000	47000