Ann, bob, carol, and denis own a candy store. after a large argument, they decide to dissolve their partnership using the sealed bid method. ann bids $320,000 for the store, bob bids $440,000 for it, carol bids $240,000 for it, and denis bids $400,000 for it. what is ann's fair share? $ what is bob's fair share? $ what is carol's fair share? $ what is denis's fair share? $ since bob has the highest bid, he receives the business. after the initial allocation there is a surplus of how much? $ in the final settlement, how much money does ann receive?

(a) $80,000; $110,000; $60,000; $100,000

(b) $90,000

(c) $102,500

Explanation:

(a)

Fair share is calculated from each player's bid divided by the total number of players.

Ann's fair share = $320,000/4

                          = $80,000

Bob's fair share = $440,000/4

                          = $110,000

Carol's fair share =  $240,000/4

                          = $60,000

Denis's fair share = $400,000/4

                             = $100,000

(b) Since Bob has the highest bid, he receives the business.

Payments:

Ann = $80,000 paid by estate

Bob = $440,000 - $110,000

       = $330,000 owes estate

Carol = $60,000 paid by estate

Denis = $100,000 paid by estate

Therefore,

Surplus = $330,000 - ($80,000 + $60,000 + $100,000)

             = $90,000

Split it equally among the four players:

So, each one receives = $90,000/4

                                      = $22,500

(c) In final settlement Ann receive = $80,000 +  $22,500

                                                         = $102,500