Gale, McLean, and Lux are partners of Burgers and Brew Company with capital balances as follows: Gale, $96,000; McLean, $93,000; and Lux, $159,000. The partners share profit and losses in a 3:2:5 ratio. McLean decides to withdraw from the partnership. Prepare General Journal entries to record the May 1, 2020, withdrawal of McLean from the partnership under each of the following unrelated assumptions: a. McLean sells his interest to Freedman for $180,000 after Gale and Lux approve the entry of Freedman as a partner (where McLean receives the cash personally from Freedman). •1 Record the admission of Freedman. b. McLean gives his interest to a son-in-law, Park. Gale and Lux accept Park as a partner. •1 Record the admission of Park. c. McLean is paid $93,000 in partnership cash for his equity. •1 Record withdrawal of McLean, where he is paid $93,000 in partnership cash for his equity. d. McLean is paid $144,000 in partnership cash for his equity. •1 Record the withdrawal of McLean. e. McLean is paid $39,250 in partnership cash plus machinery that is recorded on the partnership books at $127,000 less accumulated depreciation of $95,000. (Round final answers to 2 decimal places.) •1 Record the withdrawal of McLean
Gale, McLean, and Lux are partners of Burgers and Brew Company with capital balances as follows: Gale, $96,000; McLean, $93,000; and Lux, $159,000. The partners share profit and losses in a 3:2:5 ratio. McLean decides to withdraw from the partnership. Prepare General Journal entries to record the May 1, 2020, withdrawal of McLean from the partnership under each of the following unrelated assumptions: a. McLean sells his interest to Freedman for $180,000 after Gale and Lux approve the entry of Freedman as a partner (where McLean receives the cash personally from Freedman). •1 Record the admission of Freedman. b. McLean gives his interest to a son-in-law, Park. Gale and Lux accept Park as a partner. •1 Record the admission of Park. c. McLean is paid $93,000 in partnership cash for his equity. •1 Record withdrawal of McLean, where he is paid $93,000 in partnership cash for his equity. d. McLean is paid $144,000 in partnership cash for his equity. •1 Record the withdrawal of McLean. e. McLean is paid $39,250 in partnership cash plus machinery that is recorded on the partnership books at $127,000 less accumulated depreciation of $95,000. (Round final answers to 2 decimal places.) •1 Record the withdrawal of McLean
Chapter11: Partnerships: Distributions, Transfer Of Interests, And Terminations
Section: Chapter Questions
Problem 4BCRQ
Related questions
Question
Gale, McLean, and Lux are partners of Burgers and Brew Company with capital balances as follows: Gale, $96,000; McLean, $93,000; and Lux, $159,000. The partners share profit and losses in a 3:2:5 ratio. McLean decides to withdraw from the partnership . Prepare General Journal entries to record the May 1, 2020, withdrawal of McLean from the partnership under each of the following unrelated assumptions:
a. McLean sells his interest to Freedman for $180,000 after Gale and Lux approve the entry of Freedman as a partner (where McLean receives the cash personally from Freedman).
•1 Record the admission of Freedman.
b. McLean gives his interest to a son-in-law, Park. Gale and Lux accept Park as a partner.
•1 Record the admission of Park.
c. McLean is paid $93,000 in partnership cash for his equity.
•1 Record withdrawal of McLean, where he is paid $93,000 in partnership cash for his equity.
d. McLean is paid $144,000 in partnership cash for his equity.
•1 Record the withdrawal of McLean.
e. McLean is paid $39,250 in partnership cash plus machinery that is recorded on the partnership books at $127,000 less accumulated depreciation of $95,000. (Round final answers to 2 decimal places.)
•1 Record the withdrawal of McLean.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you