Brislin, Humphreys, and Watkins share income and losses in a ratio of 3:2:5, respectively. The capital account balances of the partners are as follows: Brislin Capital $602,000 Humphreys, Capital 368,000 Watkins, Capital 261,000 Prepare the journal entry on the books of the partnership to record the withdrawal of Watkins under the following independent circumstances: Brislin agrees to pay Watkins $188,000 for one-half of his capital interest and Humphreys agrees to pay Watkins $188,000 for one-half of his capital interest in a personal transaction among the partners.
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
Brislin, Humphreys, and Watkins share income and losses in a ratio of 3:2:5, respectively. The capital account balances of the partners are as follows:
| Brislin Capital | $602,000 | |
| Humphreys, Capital | 368,000 | |
| Watkins, Capital | 261,000 |
Prepare the
Brislin agrees to pay Watkins $188,000 for one-half of his capital interest and Humphreys agrees to pay Watkins $188,000 for one-half of his capital interest in a personal transaction among the partners. (Credit account titles are automatically indented when amount is entered. Do not indent manually. List all debit entries before credit entries.)
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Account Titles and Explanation
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Debit
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Credit
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select an account title
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enter a debit amount
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enter a credit amount
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select an account title
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enter a debit amount
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enter a credit amount
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select an account title
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enter a debit amount
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enter a credit amount
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