Problem
The partnership of Peter, Paul, and Mary share profits and losses in the ratio of 4:4:2, respectively. The partners voted to dissolve the partnership when its assets, liabilities, and capital were as follows: Assets Cash $250,000 Other assets 1,000,000 $1,250,000 Liabilities and Capital Liabilities $200,000 Peter, Capital 300,000 Paul, Capital 350,000 Mary, Capital 400,000 $1,250,000 The partnership will be liquidated over a prolonged period of time. As cash is available, it will be distributed to the partners. The first sale of noncash assets having a book value of $600,000 realized $475,000. How much cash should be distributed to each partner after this sale?