White, Sands, and Luke has the following capital balances and profit and loss ratios:
$60,000 (30%); $100,000 (20%); and $200,000 (50%).
The partnership has received a predistribution plan.
How would $90,000 be distributed?

Question

Quizplus · Accepted Answer

Sands: $20,000 + $20,000 ($90,000 - $20,000 = $70,000 × 2/7) = $40,000Luke: $50,000 ($90,000 - $20,000 = $70,000 × 5/7)

White, Sands, and Luke Has the Following Capital Balances and Profit