Question

The Abrams, Bartle, and Creighton partnership began the process of liquidation with the following balance sheet:

Answer 1

Answer and Explanation:

The contribution of assets to the partnership to cover a deficit is presented below:  

Particulars          Abram                      Bartle                       Creighton

Capital Balance  $80,000                  $90,000                  $130,000

Less:

Allocation of non cash assets sold ($434,000 - $134,000) = $300,000 in 3 : 2 :5 ratio

                           -$90,000                    -$60,000                  -$150,000

Liquidation expense -$3,600               -$2,400                    -$6,000

Liabilities  ($150,000 - $16,000) = $134,000 in 3 : 2 :5 ratio

                              -$40,200                 -.$26,800                 -$67,000

Adjusted capital balance -$53,800         $800                       -$93,000

So based on the above calculation the Abram and Creighton have to contribute the assets