Lewis, Zapata, and Fowler share equally in net income and net losses. After the partnership sells all assets for cash, divides the losses on realization, and pays the liabilities, the balances in the capital accounts are as follows: Lewis, $26,300 Cr.; Zapata, $57,900 Cr.; Fowler, $16,800 Dr. a.  What term is applied to the debit balance in Fowler's capital account? Deficiency  b.   What is the amount of cash on hand? $ c.  Journalize the transaction that must take place for Lewis and Zapata to receive cash in the liquidation process equal to their capital account balances. If an amount box does not require an entry, leave it blank.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter15: Partnership Accounting
Section: Chapter Questions
Problem 1PA: The partnership of Tatum and Brook shares profits and losses in a 60:40 ratio respectively after...
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Liquidating Partnerships—Capital Deficiency

Lewis, Zapata, and Fowler share equally in net income and net losses. After the partnership sells all assets for cash, divides the losses on realization, and pays the liabilities, the balances in the capital accounts are as follows: Lewis, $26,300 Cr.; Zapata, $57,900 Cr.; Fowler, $16,800 Dr.

a.  What term is applied to the debit balance in Fowler's capital account?

Deficiency 

b.   What is the amount of cash on hand?
$

c.  Journalize the transaction that must take place for Lewis and Zapata to receive cash in the liquidation process equal to their capital account balances. If an amount box does not require an entry, leave it blank.

  Cash     
  Fowler, Capital     
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