The Capital Balances,prior to the Liquidation of the XYZ Partnership,were

question 36

Multiple Choice

The capital balances,prior to the liquidation of the XYZ partnership,were as follows: X,Y,and Z share profits and losses in the ratio of 5:3:2.As a result of a loan,the partnership owes Y $80,000.Using the information above,which partner has the highest Loss Absorption Power (LAP) prior to liquidation?

• A) X
• B) Y
• C) Z
• D) Both X and Y

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