Jemma and Sally Are in Partnership

question 11

Multiple Choice

Jemma and Sally are in partnership. Their capital balances at the end of the accounting period are $200 000 and $150 000 respectively. Jemma decides to make a permanent cash withdrawal from her capital account of $50 000. If it is assumed that they use the fixed capital balances method (method 2) , what is the accounting entry to record this transaction?

• A) Debit Jemma capital account $50 000; credit profit distribution account $50 000
• B) Debit Jemma retained earnings account $50 000; credit profit distribution account $50 000
• C) Debit Jemma capital account $50 000; credit bank account $50 000
• D) Debit Jemma retained earnings account $50 000; credit bank account $50 000

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Definitions:

Black Magic

Practices of magic that are intended to invoke supernatural powers for malevolent purposes.

Susto

A cultural illness primarily found in Latin America, described as a condition of intense fear believed to stem from a traumatic event causing the soul to leave the body.

Taijin-kyofusho

A Japanese culture-specific syndrome characterized by an intense fear that one's body, body parts, or bodily functions are displeasing or offensive to others.

Amok

A culturally bound syndrome primarily observed in Southeast Asia, characterized by a sudden outburst of violent behavior, often driven by a perceived slight or insult.