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When Danny withdrew from John, Daniel, Harry, and Danny, LLP, he was paid $80,000, although his capital account balance was only $60,000. The four partners shared net income and losses equally, and no revaluation will take place. The journal entry to record the effect on John's capital due to Danny's withdrawal would include: $6,667 debit to John, Capital. O $5,000 debit to John, Capital. O $20,000 debit to John, Capital. $5,000 credit to John, Capital. $6,667 credit to John, Capital.

When Danny withdrew from John, Daniel, Harry, and Danny, LLP, he was paid $80,000, although his capital account balance was only $60,000. The four partners shared net income and losses equally, and no revaluation will take place. The journal entry to record the effect on John's capital due to Danny's withdrawal would include: $6,667 debit to John, Capital. O $5,000 debit to John, Capital. O $20,000 debit to John, Capital. $5,000 credit to John, Capital. $6,667 credit to John, Capital.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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When Danny withdrew from John, Daniel, Harry, and Danny, LLP, he was paid $80,000, although his capital account balance was only $60,000. The four partners shared net income and losses equally, and no revaluation will take place. The journal entry to record the effect on John's capital due to Danny's withdrawal would include: $6,667 debit to John, Capital. O $5,000 debit to John, Capital. O $20,000 debit to John, Capital. $5,000 credit to John, Capital. $6,667 credit to John, Capital.
Transcribed Image Text:When Danny withdrew from John, Daniel, Harry, and Danny, LLP, he was paid $80,000, although his capital account balance was only $60,000. The four partners shared net income and losses equally, and no revaluation will take place. The journal entry to record the effect on John's capital due to Danny's withdrawal would include: $6,667 debit to John, Capital. O $5,000 debit to John, Capital. O $20,000 debit to John, Capital. $5,000 credit to John, Capital. $6,667 credit to John, Capital.
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