Determine the amount for which the partnership must sell

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The partnership of Winn, Xie, Yang, and Zed has the following balance sheet:

Cash                                                    $45,000

Liabilities                                             $61,000

Other assets                                         284,000

Winn, capital (50% of profits and losses)  75,000

Xie, capital (30%)                                 93,000

Yang, capital (10%)                                 55,000

Zed, capital (10%)                                  45,000

Point 1: Zed is personally insolvent, and one of his creditors is considering suing the partnership for the $5,000 that is currently owed. The creditor realizes that this litigation could result in partnership liquidation and does not wish to force such an extreme action unless Zed is reasonably sure of obtaining at least $5,000 from the liquidation.

Question 1: Determine the amount for which the partnership must sell the other assets to ensure that Zed receives $5,000 from the liquidation. Liquidation expenses are expected to be $30,000.

Reference no: EM132471551

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