Harding, Jones, and Sandy Is in the Process of Liquidating

Harding, Jones, and Sandy is in the process of liquidating and the partners have the following capital balances; $24,000, $24,000, and ($9,000) respectively. The partners share all profits and losses 16%, 48%, and 36%, respectively. Sandy has indicated that the ($9,000) deficit will be covered with a forthcoming contribution. The remaining partners have requested to immediately receive $20,000 in cash that is available. How should this cash be distributed?

A) Harding $5,000; Jones $15,000.
B) Harding $17,000; Jones $3,000.
C) Harding $11,154; Jones $8,846.
D) Harding $14,297; Jones $5,703.
E) Harding $12,500; Jones $7,500.

Correct Answer:

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