Following is a series of independent cases. In each situation, indicate the cash distribution to be made to partners at the end of the liquidation process. Unless otherwise stated, assume that all solvent partners will reimburse the partnership for their deficit capital balances.
Part A
The Buarque, Monte, and Vinicius partnership reports the following accounts. Vinicius is personally insolvent and can contribute only an additional $17,000 to the partnership.
Cash $ 138,000
Liabilities 43,000
Monte, loan 36,000
Buarque, capital (50% of profits and losses) 34,000
Monte, capital (25%) 48,000
Vinicius, capital (25%) (23,000 ) (deficit) 
Part B
Drawdy, Langston, and Pearl operate a local accounting firm as a partnership. After working together for several years, they have decided to liquidate the partnership’s property. The partners have prepared the following balance sheet:
Cash $ 28,000
Liabilities $ 39,000
Drawdy, loan 13,000
Langston, loan 21,000 
Noncash assets 166,000
Drawdy, capital (40%) 73,000
Langston, capital (30%) 58,000
Pearl, capital (30%) 16,000 Total assets $ 207,000 Total liabilities and capital $ 207,000 The firm sells the noncash assets for $128,000; it will use $23,000 of this amount to pay liquidation expenses. All three of these partners are personally insolvent.
Part C
Drawdy, Langston, and Pearl operate a local accounting firm as a partnership. After working together for several years, they have decided to liquidate the partnership’s property. The partners have prepared the following balance sheet: Cash $ 28,000 Liabilities $ 39,000 Drawdy, loan 13,000 Langston, loan 21,000 Noncash assets 166,000 Drawdy, capital 73,000 Langston, capital 58,000 Pearl, capital 16,000 Total assets $ 207,000 Total liabilities and capital $ 207,000 The firm sells the noncash assets for $128,000; it will use $14,000 of this amount to pay liquidation expenses. All three of these partners are personally insolvent. Assume that the profits and losses are split 2:4:4 to Drawdy, Langston, and Pearl, respectively. 
Part D
Following the liquidation of all noncash assets, the partnership of Krups, Lindau, Riedel, and Schnee has the following account balances. Krups is personally insolvent. Liabilities $ 9,000 Krups, loan 14,000 Krups, capital (30% of profits and losses) (36,000 ) deficit Lindau, capital (30%) (38,000 ) deficit Riedel, capital (20%) 23,000 Schnee, capital (20%) 28,000.

Answer rating: 100% (QA)

Part A The cash distribution to be made to partners at the end of the liquidation process for the Bu... View the full answer