on december 31 the capital balances and 263186

On December 31, the capital balances and income ratios in SAR Company are as follows.

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Instructions

(a) Journalize the withdrawal of Ruscoe under each of the following assumptions.

(1) Each of the continuing partners agrees to pay $18,000 in cash from personal funds to purchase Ruscoe’s ownership equity. Each receives 50% of Ruscoe’s equity.

(2) Ames agrees to purchase Ruscoe’s ownership interest for $25,000 cash.

(3) Ruscoe is paid $34,000 from partnership assets, which includes a bonus to the retiring partner.

(4) Ruscoe is paid $22,000 from partnership assets, and bonuses to the remaining partners are recognized.

(b) If Ames’s capital balance after Ruscoe’s withdrawal is $42,400, what were (1) the total bonus to the remaining partners and (2) the cash paid by the partnership toRuscoe?

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