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Merz, Dechter, and Flowers are partners in a partnership and share profits and losses 40%, 40%, and 20%, respectively. The partners have agreed to liquidate the partnership and anticipate that liquidation expenses will total $14,000. Prior to the liquidation, the partnership balance sheet reflects the following book values: Cash $ 25,000 Noncash assets 200,000 Note payable to Dechter 12,000 Other liabilities 165,000 Capital, Merz 40,000 Capital Dechter 18,000 Capital deficit, Flowers (10,000) Required: Assuming that the actual liquidation expenses are $20,000 and that noncash assets are sold for $160,000, determine how the assets will be distributed. Flowers has net personal assets of $10,000.
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