Problem
The partners in ABC partnership have decided to liquidate the partnership. Its balance sheet is below.
|
Cash
|
$10,000
|
Liabilities
|
$6,000
|
|
Inventory
|
5,000
|
A, capital
|
7,000
|
|
Equipment
|
25,000
|
B, capital
|
12,000
|
|
|
|
C, capital
|
15,000
|
|
TOTAL
|
$40,000
|
TOTAL
|
$40,000
|
The partners share income in a 2:3:5 ratio.
Now assume none of the inventory or equipment is sold, but the partners want to distribute $2,500 in cash to the partners. How much cash is distributed to partner B?