Partners David and Goliath have decided to liquidate their business. The following information is available: Cash$100,000 Inventory 200,000 $300,000 Accounts payable$80,000 David, Capital 140,000 Goliath, Capital 80,000 $300,000 David and Goliath share profits and losses in a 3:1 ratio, respectively. During the first month of liquidation, half the inventory is sold for $70,000, and $50,000 of the accounts payable are paid. During the second month, the rest of the inventory is sold for $55,000, and the remaining accounts payable are paid. Cash is distributed at the end of each month, and the liquidation is completed at the end of the second month.Refer to the information provided above. Using a safe payment schedule, how much cash will be distributed to David at the end
of the first month?
A. $42,500
B. $75,000
C. $22,500
D. $117,500
Answer: A
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