Hillary,Bruce,and Cindy Own a Partnership Firm

question 42

Multiple Choice

Hillary,Bruce,and Cindy own a partnership firm.Hillary has an ownership interest of $24,000; Bruce has an ownership interest of $41,000; and Cindy has an ownership interest of $30,000.In the process of liquidation,the partnership sells non-cash assets and registers a gain of $30,000.The profit-loss sharing agreement is 1/6 to Hillary; 2/6 to Bruce; and 3/6 to Cindy.Which of the following is TRUE when a journal entry for the allocation of gain is recorded?

• A) Hillary, Capital is credited for $10,000.
• B) Cindy, Capital is credited for $15,000.
• C) Hillary, Capital is debited for $10,000.
• D) Cindy, Capital is credited for $10,000.

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