Alpha, Beta and Gamma are partners who have capital balances of $480,000, $500,000, and $180,000 respectively. P/L is distributed in the ratio of 4:2:1. Beta received $260,000 as a result of liquidating the partnership when 60% of the non cash assets of the partnership is realized. The partnership has total assets totalling to $500,000 including $50,000 cash before liquidation. The partnership also incurred $35,000 liquidation expenses and withheld $28,000 for the unpaid liabilities of the partnership. What is the loss on realization of noncash assets? A. 632,000 B. 875,000 C. 855,000 D. 612,000
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PROBLEM:
Alpha, Beta and Gamma are partners who have capital balances of $480,000, $500,000, and $180,000 respectively.
P/L is distributed in the ratio of 4:2:1.
Beta received $260,000 as a result of liquidating the partnership when 60% of the non cash assets of the partnership is realized.
The partnership has total assets totalling to $500,000 including $50,000 cash before liquidation.
The partnership also incurred $35,000 liquidation expenses and withheld $28,000 for the unpaid liabilities of the partnership.
What is the loss on realization of noncash assets?
A. 632,000
B. 875,000
C. 855,000
D. 612,000
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