A local partnership has assets of cash of $5,000 and a building recorded at $80,000. All liabilities have been paid. The partners' capital accounts are as follows: Harry $40,000, Landers $30,000 and Waters $15,000. The partners share profits and losses 4:4:2.If the building is sold for $50,000 and there are no liquidation expenses what amount should Harry receive in the final settlement?

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The building is sold for $50,000, resulting in a $30,000 loss ($80,000 - $50,000). This loss is shared among the partners in the ratio 4:4:2, so Harry's share of the loss is $12,000 (4/10 of $30,000). Harry's capital account after the loss is $28,000 ($40,000 - $12,000). With $5,000 cash available, Harry receives $28,000 in the final settlement.

A Local Partnership Has Assets of Cash of $5,000 and a Building