Capital balances and profit and loss sharing ratios of the partners in the BIG Entertainment Galley are as follows: Ben capital (50%) .... $ 700,000 Irv capital (30%) ..... 480,000 Geo capital (20%) ...... 300,000 Total .......... $1,480,000 Ben needs money and agrees to assign half of his interest in the partnership to Pet for $180,000 cash. Pet pays $180,000

Chapter 16, Exercises #6

Capital balances and profit and loss sharing ratios of the partners in the BIG Entertainment Galley are as follows:
Ben capital (50%) .... $ 700,000
Irv capital (30%) ..... 480,000
Geo capital (20%) ...... 300,000
Total .......... $1,480,000
Ben needs money and agrees to assign half of his interest in the to Pet for $180,000 cash. Pet pays $180,000 directly to Ben.
REQUIRED
1. Prepare a journal entry to record the assignment of half of Ben’s interest in the to Pet.
2. What is the total capital of the BIG immediately after the assignment of the interest to Pet?

Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...