Chen, Korhonen, Lebuca, and Swid are partners who share profits and losses on a 4:3:2:1 basis, respectively. They are beginning to liquidate the business. At the start of this process, capital balances are
Chen, capital $ 78,000
Korhonen, capital 32,400
Lebuca, capital 61,000
Swid, capital 25,400
Required:
Prepare a predistribution plan to determine which partner will be the first to receive cash from the liquidation and what amount that partner will receive before other partners receive any cash.
Note: Amounts to be deducted should be entered with a minus sign.
Beginning balances
Assumed loss
Balances
Assumed loss
Balances
Assumed loss
Balances
Chen Korhonen Lebuca Swid
$ 78,000 $ 32,400 $ 61,000 $ 25,400