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Question - The GHK partnership has the following balance sheet:
Cash $30,000
Other assets $170,000
Recourse liabilities $50,000
Capital - G $50,000
Capital - H $50,000
Capital - K $50,000
Partnership profits are allocated equally. Losses are allocated 50% to G, 25% to H, and 25% to K. The partnership agreement has a capital account deficit restoration requirement. How should the recourse liability be allocated?
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