Terry Constantino, Carissa Alton, and Andrew Morris have run a successful partnership for a number of years, sharing income 4:2:2, respectively. Carissa Alton has decided to leave the partnership. After the assets of the partnership have been adjusted to current market values, the capital balances of Constantino, Alton, and Morris are as follows:
Terry Constantino, Capital ........................ $102,000
Carissa Alton, Capital .............................. 66,000
Andrew Morris, Capital ............................ 72,000
The partnership offers Alton $60,000 upon her retirement.
a. Provide the journal entry for Alton's departure on July 10, 2015.
b. Provide the journal entry to close the income summary account at the end of 2015, assuming net income of $100,500 was earned for the remainder of the year, after the books were closed on July 10, 2015, to record Alton's retirement.