A partnership has assets of cash of $10,000 and equipment with a book value of $160,000. All liabilities have been paid. The partners' capital accounts are as follows Michael $80,000, Gregory $60,000 and Phillips $30,000. The partners share profits and losses on a 4:3:3 basis. If the equipment is sold for $100,000 and there are no liquidation expenses what amount should Gregory receive in the final settlement?

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Gregory's capital account balance is $60,000. The equipment is sold for $100,000, resulting in a gain of $40,000. Gregory's share of the gain is 3/10 * $40,000 = $12,000. His total capital account balance after the gain is $60,000 + $12,000 = $72,000. After paying off all liabilities, the remaining assets are $10,000 (cash) + $72,000 (Gregory's capital account balance) = $82,000. Gregory's share of the remaining assets is 3/10 * $82,000 = $24,600. Therefore, Gregory should receive $24,600 in the final settlement.

A Partnership Has Assets of Cash of $10,000 and Equipment