Problem statement: The partnership of Able, Bower, and Cramer was liquidated. The partners have shared profits and losses in the ratio of 2:4:4. Prior to liquidation, their capital balances were the following*:
Able Bower Cramer
$10,000 $(5,000) $(15,000)
* Deficit shown in parentheses
Cash totaled $20,000, with liabilities amounting to $30,000. A review of the individual partners' personal financial status reveals the following:
Assets Liabilities
Able $ 5,000 $20,000
Baker 6,000 4,000
Cramer 30,000 20,000
Required:
Prepare a worksheet to liquidate the partnership.