Answer:
Turner, Roth, and Lowe
a. Loss from selling the assets = $78,800
b. Loss allocation to the partners:
Turner Roth Lowe
Loss sharing ($78,800) $7,880 $31,520 $39,400
c. Capital contribution to cover deficiency:
Turner Roth Lowe
Contribution to cover deficiency $3,000 $12,000 $15,000
Explanation:
a) Data and Calculations:
Turner Roth Lowe
Income and loss sharing ratio: 1 4 5
Assets before liquidation = $130,800
Liabilities = $82,000
Capital balances $2,900 $14,200 $31,700
Cash received from sale of assets = $52,000 ($82,000 - $30,000)
Loss from sale of assets = $78,800 ($130,800 - $52,000)
Loss sharing ($78,800) $7,880 $31,520 $39,400
Contribution to cover deficiency $3,000 $12,000 $15,000
