The balance sheet of Adams Pharmacy after the revenue, expense, and partners drawing accounts have been closed on December 31, 20X1, follows:

ADAMS PHARMACY
Balance Sheet
December 31, 20X1
Assets
Cash			$82,900
Accounts Receivable			16,500
Merchandise Inventory			427,500
Equipment	$169,000
Accumulated DepreciationEquipment	98,500		70,500
Building	410,000
Accumulated DepreciationBuilding	325,000		85,000
Land			45,000
Total Assets			$727,400
Liabilities and Partners' Equity
Liabilities
Accounts Payable			$409,700
Taxes Payable			22,700
Total Liabilities			432,400
Partners Equity
Larry Adams, Capital	$165,000
Hazel Adams, Capital	65,000
Isiah Adams, Capital	65,000
Total Partners Equity			295,000
Total Liabilities and Partners' Equity			$727,400

On that date, Larry Adams, Hazel Adams, and Isiah Adams agree to admit Vickie Neal to the partnership. The partnership agreement provides that, in case of dissolution of the partnership, all assets and liabilities should be revalued. Profits and losses are shared in the ratio of 50:25:25, to Larry, Hazel, and Isiah, respectively. The agreed-upon values of the assets are as follows:

Accounts receivable	$	15,200		Building		$	131,500
Merchandise inventory		403,400		Land			95,500
Equipment		70,500

All liabilities are properly recorded. Required:

1. Prepare the general journal entries to record revaluation of the assets.
2. Prepare the general journal entry (or entries) to record Vickie Neals investment of $120,000, assuming that she is to receive capital equal to the amount invested.
3. Prepare the general journal entry (or entries) to record Vickie Neals investment of $120,000, assuming that she is to receive one-fifth of the capital of the partnership.
4. Prepare the general journal entry (or entries) to record Vickie Neals investment of $120,000, assuming that she is to receive one-third of the capital of the partnership.
5. Assume that after the revaluation had been recorded, the existing partners and Vickie Neal decided that their previous agreement should be canceled and that Vickie Neal should not become a partner. Instead, the partners agreed that Hazel Adams would withdraw from the partnership and be paid cash by the partnership.
6. Prepare the general journal entry to record the payment to Hazel Adams if she is paid an amount equal to her capital account balance after the revaluation.
7. Prepare the general journal entry to record the payment to Hazel Adams if she is paid an amount equal to $13,500 less than her capital account balance after revaluation.
8. Prepare the general journal entry to record the payment to Hazel Adams if she is paid an amount equal to $11,100 more than her capital account balance after revaluation.

Analyze: Assume that the assets have been revalued and that Vickie Neal has invested $120,000 in the partnership receiving one-fifth of the capital in the partnership. What is the balance of Isiah Adamss capital account at January 1, 20X2?