As of January 1, 2018, the partnership of Canton, Yulls, and Garr had the following account balances and percentages for the sharing of profits and losses: Cash$80,000 Noncash assets 205,000 Liabilities 47,000 Canton, capital (30%) 138,000 Yulls, capital (40%) 119,500 Garr, capital (30%) (19,500)??The partnership incurred losses in recent years and decided to liquidate. The liquidation expenses were expected to be $10,000.?If the noncash assets are sold for $105,000, what would be the maximum amount of cash that Canton could expect to receive?
What will be an ideal response?
The maximum amount that Canton could be expected to receive is $105,000. This assumes that Garr can cover his deficit:
| Canton | Yulls | Garr | Total | |||||||||
| Capital account balances | $ | 138,000 | $ | 119,500 | $ | (19,500 | ) | $ | 238,000 | |||
| Loss on sale of assets | (30,000 | ) | (40,000 | ) | (30,000 | ) | (100,000 | |||||
| Liquidation expenses | (3,000 | ) | (4,000 | ) | (3,000 | ) | (10,000 | ) | ||||
| Balances | $ | 105,000 | $ | 75,500 | $ | (52,500 | ) | $ | 128,000 | |||
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