Problem

The Cas, Don, and Ear partnership balance sheet and profit and loss percentages at June 30...

The Cas, Don, and Ear partnership balance sheet and profit and loss percentages at June 30, 2011, are summarized as follows:

Assets

$500,000

Cas capital (30%)

$140,000

 

 

Don capital (30%)

175,000

 

 

Ear capital (40%)

185,000

 

$500,000

 

$500,000

On July 1, 2011, the partners agree that Cas is to retire immediately and receive $161,000 for her partnership interest.

REQUIRED: Prepare journal entries to illustrate three possible methods of accounting for the retirement of Cas.

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Solutions For Problems in Chapter 16