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, what amount should Waters 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 according to their profit and loss sharing ratio (4:4:2). Waters' share of the loss is $6,000 (20% of $30,000). Waters' capital account after the loss is $9,000 ($15,000 - $6,000). Adding Waters' share of the cash ($5,000 * 20% = $1,000), Waters receives $9,000 in the final settlement.

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