The amount standing at the credit of X's capital, prior to the distribution of the dividend, was $18,000. If his new capital is to be $16,500, assigned on the basis of the profit-and-loss-sharing ratio, it would mean that out of $33,000 to be distributed, he is to receive $1,500. Then Y's capital, according to the new arrangement, will be $9,900, whereas his present capital is $22,800, and the difference between these two sums, or $12,900, will be the proportion of the $33, 000 to be given to Y. By the same method it is easy to show that Z is to receive $18,600 of the $33,000.
It may happen, in such cases, that the first dividend will not be sufficient to permit the reduction of all the capital accounts of the partners to the profit-and-loss sharing ratio, and that one of the partners will re ceive nothing from the first dividend. For example, if the first dividend distributed amounted to $30,000, the amount of the aggregate capital after the distri bution would be $36,000. Of the $30,000, Y's share would be $12,000, Z's would be $18,000 and X would receive nothing. The remaining capital accounts
would then be as follows: X—$18,000; Y—$10,800; Z--$7,200. The ratio is five, three and two. The following tabulation states this in summary form: Of course, according to this arrangement X would receive nothing from the first dividend. If he should object to this method of distribution the liquidator could withhold all cash and not distribute any of it until he could be certain that he would not be per sonally liable in case he paid too much to any of the partners.
11. Other examples of partnership adjustment.— When a receiver has been appointed to wind up the affairs of a partnership, it is customary to prepare a statement of affairs setting forth the status of the business, on the basis of enforced liquidation. The proceedings are under the direction of a court of com petent jurisdiction. Discussion of this kind of state ment and of the principles involved in the sale and transfer of the assets of a partnership to a corpora tion, is postponed until a later chapter.