The partnership of Arun, Margot, and Tammy has been doing well. Arun wants to retire and move to another state for a once-in-a-lifetime opportunity. The partners’ capital balances prior to Arun’s retirement are $60,000 each. Prepare a schedule showing how Arun’s withdrawal should be divided assuming his buyout is:
A. $70,000
B. $45,000
C. $60,000.
In addition, show the resulting entries to the capital accounts of each of the three.