Reference no: EM132756461
Problem 1: Norton was paid $40,000 from the partnership cash account for his withdrawal from the partnership of Maxwell, Slade, and Norton. Their capital balances were $40,000, $60,000, and $35,000, respectively. The journal entry to record the withdrawal of Norton would include:
A. a debit to cash for $40,000
B. a debit to Maxwell's capital account for $5,000
C. a debit to Slade's capital account for $5,000
D. a debit to Norton's capital account for $35,000
Problem 2: The other assets were sold for $50,000, and the liabilities were paid, in preparation to liquidating the partnership. Income and loss was shared evenly. Any deficient partner will be unable to pay the deficiency. Which of the following is NOT true?
A. The loss on liquidation was $21,000.
B. The cash balance before final distribution was $40,000.
C. Maxwell's share of the ending cash balance was $22,000
D. Slade's share of the ending cash balance was $19,000