Chapter 5
Partnerships
248
Analysis
What are the reasons a partnership would decide to liquidate?
AP-12B (
7
)
Cooper, Amy and Jacob formed a partnership in 2016. On January 1, 2017, the partners
had the following capital account balances: Cooper—$35,000, Amy—$60,000 and
Jacob—$50,000. On January 1, 2017, Jacob decided to withdraw from the partnership due to
unresolved disputes. The withdrawal of Jacob was paid from the partnership’s assets. Prepare
the journal entry to record the transaction and calculate the balance of the partners’ capital
accounts after the withdrawal of Jacob.
Date
Account Title and Explanation
Debit
Credit
Cooper
Amy
Jacob
Total
Capital balance before withdrawal
Withdrawal of Jacob
Capital balance after withdrawal
