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At the time they decided to liquidate their partnership, Whitehead, Ellis and Riley had capital balances of $120,000, $96,000 and $160,000, respectively. Liabilities were $76,800 and the balance sheet showed a note receivable from Ellis in the amount of $64,000. The partners share income in a 5:3:2 ratio. Prepare a schedule showing how cash is to be distributed as it becomes available during the liquidation process.

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$ Prepare a schedule showing how cash is to be distributed as it becomes available during the liquidation process. Remember to use negative signs with answers that reduce the capital balances. Whitehead Ellis Riley Capital balances per books $ 120,000 $ 96,000 $ 160,000 Deduct loan receivable (64,000) 0 Pre-liquidation balances $ 120,000 32,000 $ 160,000 Standardized capital balances $ 240,000 320,000 x $ 800,000 (a) Equalize Whitehead and Riley 480,000 x 240,000 $ 320,000 x $ 320,000 (b) Equalize Whitehead, Ellis & Riley Ox 80,000 x 80,000 x 240,000 x $ 240,000 x $ 240,000 X Convert equalization adjustments - (a) $ 0 $ 0$ 96,000 X Convert equalization adjustments - (b) $ Ox $ 24,000 X $ 16,000 X $ $ $ First $ > Next $ Cash Distribution Plan: 240,000 * to creditors 96,000 to Riley 40,000 * to Whitehead and Riley in a 5:2 ratio 160,000 * to Whitehead, Ellis and Riley in a 5:3:2 ratio . Next $ Cash over $

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