On December 31, the capital balances and income ratios in MSY Company are as follows (amounts in thousands).

Instructions
a. Journalize the withdrawal of Yen under each of the following assumptions.
1. Each of the continuing partners agrees to pay HK$18,000 in cash from personal funds to purchase Yen’s ownership equity. Each receives 50% of Yen’s equity.
2. Sang agrees to purchase Yen’s ownership interest for HK$25,000 cash.
3. Yen is paid HK$34,000 from partnership assets, which includes a bonus to the retiring partner.
4. Yen is paid HK$22,000 from partnership assets, and bonuses to the remaining partners are recognized.
b. If Sang’s capital balance after Yen’s withdrawal is HK$43,600, what were 

(1) The total bonus to the remaining partners and 

(2) The cash paid by the partnership to Yen?

Transcribed Image Text:

Income Ratio Partner Capital Balance Mui HK$60,000 50% Sang 40,000 30% Yen 30,000 20%