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The Field, Brown & Snow are partners and share income and losses equality. The partner decide to liquidate the partnership when their capital balances are as follows: Field, $132,000; Brown, $165,300; and Snow, $153,300. On May 31, the liquidation resulted in a loss of $408,000.

QS 12-13 (Algo) Part 3

3. Assume that the partner with a deficit does not reimburse the partnership. Prepare journal entries (a) to transfer the deficit to the other partners and (b) to record the final disbursement of cash to the partners.