Question

Assume the following information just prior to the withdrawal of Partner X: Assets Liabilities Cash $20,000 50,000 Accounts payable $5,000 Inventory Partners' Capital $10,000 20,000 35,000 X, Capital Y, Capital Z, Capítal 65,000 $70,000 $70,000 Required: Prepare journal entries to record the following unrelated scenarios: 1. Partner X sells his interest to new partner T for $25,000. 2. Partner X sells his interest to partner Y for $30,000. 3. Partner X sells his interest and is paid a share of partnership net assets as follows $ 5,000 5,000 (2,000) $ 8,000 Cash Inventory Accounts payable Partner Y receives a 60% share of the partnership interest cf X. Partner Z receives 40 %.

Answer 1

Solution's Given data, partner - Assets Cash - Pnventary $20000 S0000 liabilities decernit payable - $ 500 partners Collet -capited-10800 4-capital - 20000 z-Capital 3900 65002 7000 $70 000 and pestner - Cash . Inventary. $ 5000 SOOD Account pauptte(Less) (2000 8000 credit Debt * s capital IDODO T's capital (record selling of share to new partnes) 1000D

Debit Credit @ 1 x's capitais .. is capital (vo record of selling chane to 4) Capital 10000 Account pasigable 2000 SOOD 500D cash - Inventory y's capital (2000x600) t's capital (2000 x 40 ) (to record selling of x's interest) 1200 860 I and 2 entry is made for 10000 because the i excess received by is his personal gain. S No cash has been received by pashership.