1. Meir, Benson, and Lau are partners and share income and loss in a 3:2:5 ratio. The partnership's capital balances are as follows: Meir, $168,000; Benson, $138,000; and Lau, $294,000. Benson decides to withdraw from the partnership, and the partners agree to not have the assets revalued upon Benson's retirement. Prepare journal entries to record Benson's February 1 withdrawal from the partnership under each of the following separate assumptions: Benson (a) sells her interest to North for $160,000 after Meir and Lau approve the entry of North as a partner; (b) gives her interest to a son-in-law, Schmidt, and thereafter Meir and Lau accept Schmidt as a partner; (c) is paid $138,000 in partnership cash for her equity; (d) is paid $214,000 in partnership cash for her equity; and (e) is paid $30,000 in partnership cash plus equipment recorded on the partnership books at $70,000 less its accumulated depreciation of $23,200. 

Part 2. Assume that Benson does not retire from the partnership described in Part 1 Instead, Rhode is admitted to the partnership on February 1 with a 25 equity Prepare journal entries to record Rhodes entry into the partnership under each separate assumption Rhode invests (a) $133,333 (b) $97,333 and (c) $174,666.

Answer rating: 100% (QA)

Date Particulars Amount DR Amount Cr a Benson Capital 160000 North Capital 160000 b Benson Capital 1... View the full answer