Question

Exercise 12-12 Retirement of partner LO P4 Hunter, Folgers, and Tulip have been partners while sharing net income and loss in a 5:3:2 ratio (in percents: Hunter, 50%; Folgers, 30%; and Tulip, 20%). On January 31, the date Tulip retires from the partnership, the equities of the partners are Hunter, $150,000; Folgers, $90,000; and Tulip, $60,000. Prepare journal entries to record the retirement of Tulip under independent assumption. Assume Tulip is paid $60,000, $80,000, $30,000 for her equity using partnership cash. (Do not round intermediate calculations.) View transaction list Journal entry worksheet 11 2 3 Record the retirement of Tulip on the assumption that she is paid for her equity using partnership cash of $60,000. Note: Enter debits before credits. General Journal Debit Credit Transaction (a)

Answer 1

Solution Gredit Date Account title Ee Explanation Debit 60000 Tullp captal 31- Jan 60000 cash Tullp capital 60000 31-Jan Hunter capttal (20000x5/8) 12500 7500 fotqers Capttal (2000x 3/8) 80000 cash 6o000 Tulep capital 31-Jan 30000 Cash Hunter Capital [ 3000x 5/8] folgers captal 18750 11250 [ 30000 X 3/8]