Question
The partners of Donald, Chief & Berry LLP decided to liquidate on August 1, 2018. The balance sheet of the partnership is as follows, with
The partners of Donald, Chief & Berry LLP decided to liquidate on August 1, 2018. The balance sheet of the partnership is as follows, with the profit and loss ratio of 25%, 45%, and 30%, respectively. The partners do not expect to incur further liquidation expenses. DONALD, CHIEF, & BERRY LLP Balance Sheet August 1, 2018 Assets Liabilities & Partners' Capital Cash $ 60,000 Trade accounts payable $ 130,000 Loan receivable from Donald 40,000 Loan payable to Chief 60,000 Other assets 500,000 Donald, capital 140,000 Chief, capital 160,000 Berry, capital 110,000 Total $ 600,000 Total $ 600,000 A portion of the Other Assets with a carrying amount of $200,000 were sold for $140,000, and all available cash was distributed. Prepare the journal entry for Donald, Chief & Berry LLP on August 1, 2018, to record the offset of the loan receivable from Donald.
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