The Henry, Isaac, and Jacobs partnership was about to enter liquidation with the following account balances:
Cash:$90,000.Noncash asset:$300,000. Liabilities:$60,000.
H's capital:$80,000. I's capital:$110,000. J's Capital:$140,000.
Estimated expenses of liquidation were $5,000. Henry, Isaac, and Jacobs shared profits and losses in a ratio of 2:4:4.Before liquidating any assets, the partners determined the amount of cash for safe payments and distributed it. The noncash assets were then sold for $120,000, and the liquidation expenses of $5,000 were paid. How much of the $120,000 would be distributed to the partners? (Hint: Either a predistribution plan or a schedule of safe payments would be appropriate for solving this item.)
The correct answer is:
H:28,000
I:36,000
J:56,000