JNW is a partnership owned by Maggie James, Susan New, and Tara White. The partners’ profit-and-loss-sharing agreement is 1:1:3, respectively. The adjusted trial balance of the partnership at April 30, 2016, follows:
1. Prepare statement of partners’ equity for the month ended April 30, 2016. Use a separate column for each partner in the statement of partners’ equity. Assume no new capital contributions during April.
2. Prepare the four closing entries for the month ended April 30, 2016.
3. White decides to withdraw from the partnership on May 1, 2016. Her settlement includes all the Merchandise Inventory and all the Cash in exchange for her equity interest in the partnership.
4. Immediately after White’s withdrawal, James and New decide to liquidate the partnership. They sell the building for $146,000. Then they pay the liabilities and distribute the cash to complete the liquidation. Journalize these liquidation entries. Assume the profit-and-loss-sharing ratios are the same.