Jane, Castle, and Sean Are Dissolving Their Partnership

question 140

Multiple Choice

Jane, Castle, and Sean are dissolving their partnership. Their partnership agreement allocates each partner an equal share of all income and losses. The current period's ending capital account balances are Jane, $54,000; Castle, $42,000; and Sean, $(6,000) . After all assets are sold and liabilities are paid, there is $90,000 in cash to be distributed. Sean is unable to pay the deficiency. The journal entry to record the distribution should be:

• A) Debit Jane, Capital $54,000; debit Castle, Capital $36,000; credit Cash $90,000.
• B) Debit Jane, Capital $54,000; debit Castle, Capital $42,000; credit Cash $96,000.
• C) Debit Jane, Capital $51,000; debit Castle, Capital $39,000; credit Cash $90,000.
• D) Debit Cash $90,000, debit Sean, Capital $6,000, credit Jane, Capital $54,000, credit Castle, Capital $42,000.
• E) Debit Cash $90,000; credit Jane, Capital $30,000; credit Castle, Capital $30,000; credit Sean, Capital $30,000.

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Definitions:

Simple Cuboidal Epithelium

A single layer of cube-shaped cells, found lining glands and ducts, involved in secretion and absorption.

Podocytes

Podocytes are specialized cells in the kidney that wrap around capillaries of the glomeruli, playing a key role in the filtration of blood to form urine.

Renal Medulla

The innermost part of the kidney, composed of renal pyramids and tubules, responsible for concentrating urine.

Renal Cortex

The outer layer of the kidney involved in filtration to form urine.