Capital balances and profit and loss sharing ratios of the partners in the BIG Entertainment Galley are as follows:
Ben capital (50%) ............ $ 700,000
Irv capital (30%) ............... 480,000
Geo capital (20%) .............. 300,000
Total .......................... $1,480,000
Ben needs money and agrees to assign half of his interest in the partnership to Pet for $180,000 cash. Pet pays $180,000 directly to Ben.
REQUIRED
1. Prepare a journal entry to record the assignment of half of Ben's interest in the partnership to Pet.
2. What is the total capital of the BIG partnership immediately after the assignment of the interest to Pet?