The year-end balance sheet and residual profit and loss sharing percentages for the Gary, Harold, and Ivan partnership on December 31, 2014, are as follows: Cash $60,000 Accounts payable $150,000 Loan to Gary 50,000 Loan from Harold 50,000 Other assets 360,000 Gary, capital (25%) 70,000 Harold, capital (25%) 80,000 Ivan, capital (50%) 120,000 Total assets $470,000 Total liab./equity $470,000 The partners agree to liquidate the business and distribute cash when it becomes available. A cash distribution plan is developed with vulnerability rankings for the Gary, Harold and Ivan partnership. After outside creditors are paid, the cash available will initially go to 37) ________

Question 1 options:

1)

Ivan in the amount of $40,000.

2)

Gary in the amount of $20,000.

3)

Harold in the amount of $70,000.

4)

Harold in the amount of $50,000.