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Question - The Field, Brown & Snow partnership was begun with investments by the partners as follows: Field, $131,900; Brown, $167,500; and Snow, $155,400. The partners decide to liquidate, sharing all losses equally. On May 31, after all assets were sold and all creditors were paid, only $49,200 in partnership cash remained.
Required -
1. Compute the capital account balance of each partner after the liquidation of assets and payment of creditors.
2. Assume that the partner with a deficit pays cash to cover the deficit. Prepare the journal entries on May 31 to record (a) the cash payment to cover the deficit and (b) the final disbursement of cash to the partners.
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