Sale of partnership interestThe partners in the Biz Partnership have agreed that partner Mandy may sell her $100,000 equity in the partnership toBrittney, for which Brittney will pay Mandy $85,000. Present the partnership's journal entry to record the sale of Mandy'sinterest to Brittney on September 30.

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Business

Hassan Carter

10 August, 22:17

Sale of partnership interestThe partners in the Biz Partnership have agreed that partner Mandy may sell her $100,000 equity in the partnership toBrittney, for which Brittney will pay Mandy $85,000. Present the partnership's journal entry to record the sale of Mandy'sinterest to Brittney on September 30.

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Kimora Craig · Answer 1

Mandy Capital Debit: 100,000

Brittney Capital Credit: 100,000

Explanation:

The journal entry will be recorded as above. Mandy sold equity worth $100,000, so we will record the entry on transfer of equity by the equity value sold. Now, for this equity value both partners can decide the amount in which one will sell to other, which in this scenario is $85,000.