Floyd and Merriam Start a Partnership Business on 12 June $$\begin{array} { | l | l | } \hline \text { Floyd } & \$ 47,000 \\\hline \text { Merriam } & 16,000 \\\hline\end{array}$$

Multiple Choice

Floyd and Merriam start a partnership business on 12 June 2019.Their capital account balances as of 31 December 2020 stood as follows: $$\begin{array} { | l | l | } \hline \text { Floyd } & \$ 47,000 \\\hline \text { Merriam } & 16,000 \\\hline\end{array}$$ Floyd agrees to sell off half of his share to Ramelow in exchange for $26,000 cash.Which of the following is the correct journal entry in the books of the firm for the above transfer of interest?

A) $$\begin{array} { | l l | l | l | } \hline \text { Cash. }& & \$ 26,000 & \\\hline \text { Floyd, captial } && & 2500 \\\hline \text { Ramelow, }\text { Capital } & & &23,500 \\\hline\end{array}$$
B) $$\begin{array} { | l | l | l | } \hline \text { Cash } & \$ 26,000 & \\\hline \text { Ramelow, apital } & & 26,000 \\\hline\end{array}$$
C) $$\begin{array} { | l | l | l | } \hline \text { Floyd, captial } & \$ 23,500 & \\\hline \text { Ramelow, } & & \\\text { capital } & & 23,500 \\\hline\end{array}$$
D) $$\begin{array} { | l | l | l | } \hline \text { Cash } & \$ 26,000 & \\\hline \text { Floyd, captial } & 23,500 & \\\hline \text { Ramelow,Capital } & & 49,500\\\hline\end{array}$$