Prior to liquidating their partnership, Samuel and Brian had capital accounts of $60,000 and $240,000, respectively. The partnership assets were sold for $120,000. The partnership had no liabilities. Samuel and Brian share income and losses equally.​Required
(a) Determine the amount of Samuel's deficiency.
(b) Determine the amount distributed to Brian, assuming Samuel is unable to satisfy the deficiency.

Liquidating Partnership

The process of terminating a partnership by selling off assets, settling debts, and distributing any remaining assets to the partners.

Capital Accounts

Refers to accounts that show the owners' or shareholders' investments in a business, including retained earnings and contributed capital.

Deficiency

A shortfall or insufficiency in amount or quantity, such as when liabilities exceed assets or when actual performance is less than the standard or expected performance.