Turner, Roth, and Lowe are partners who share income and loss in a 1:4:5 ratio (in percents: Turner, 10%; Roth, 40%; and Lowe, 50%). The partners decide to liquidate the partnership. Immediately before liquidation, the partnership balance sheet shows total assets, $174,000; total liabilities, $118,000; Turner, Capital, $6,500; Roth, Capital, $16,000; and Lowe, Capital, $33,500. The liquidation resulted in a loss of $104,000. Required: a. Allocate the loss to the partners. b. Determine how much each partner should contribute to the partnership to cover any remaining capital deficiency.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Turner, Roth, and Lowe are partners who share income and loss in a 1:4:5 ratio (in percents: Turner, 10%; Roth, 40%; and Lowe, 50%). The partners decide to liquidate the partnership. Immediately before liquidation, the partnership balance sheet shows total assets, $174,000; total liabilities, $118,000; Turner, Capital, $6,500; Roth, Capital, $16,000; and Lowe, Capital, $33,500. The liquidation resulted in a loss of $104,000. Required: a. Allocate the loss to the partners. b. Determine how much each partner should contribute to the partnership to cover any remaining capital deficiency.
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