Prior to the distribution of cash to the partners, the accounts in the VCP Partnership Company are as follows: 

Cash .......................................................................... $24,000 DR 

Vogel ............................................................................17,000 CR

Cheema .......................................................................15,000CR

Pena ...............................................................................8,000 DR 

The profit and loss ratios are 5:3:2, respectively. VCP Partnership decides to liquidate.

Instructions 

a. Prepare the entry to record 

(1) Pena’s payment of $8,000 in cash to the partnership.

(2) The distribution of cash to the partners with credit balances. 

b. Prepare the entry to record 

(1) The absorption of Pena’s capital deficiency by the other partners.

(2) The distribution of cash to the partners with credit balances.