Partnership Retirement-Various Situations: The Fahad, Khalid, and Majid partnership balance sheet and profit and loss percentages at June 30, 2011, are summarized as follows: Fahad capital (30%) Khalid capital (30%) Majid capital (40%) 185,000 Assets 500,000 140,000 175,000 500,000 500,000 On July 1, 2011, the partners agree that Fahad is to retire immediately and receive $161,000 for his partnership interest. Required: Prepare journal entries to illustrate three possible methods of accounting for the retirement of Fahad.

Partnership Retirement-Various Situations: The Fahad, Khalid, and Majid partnership balance sheet and profit and loss percentages at June 30, 2011, are summarized as follows: Fahad capital (30%) Khalid capital (30%) Majid capital (40%) 185,000 Assets 500,000 140,000 175,000 500,000 500,000 On July 1, 2011, the partners agree that Fahad is to retire immediately and receive $161,000 for his partnership interest. Required: Prepare journal entries to illustrate three possible methods of accounting for the retirement of Fahad.

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter11: Stockholders' Equity

Section: Chapter Questions

Problem 11.22E

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