Masco, Short, and Henderson Who Are Partners in the MSH

Masco, Short, and Henderson who are partners in the MSH Company share income and loss in a 2:2:1 ratio. They plan to liquidate their partnership. At liquidation, their balance sheet appears as follows. Prepare journal entries for (a) the sale of land and equipment sold as a package for $500,000, (b) the allocation of the gain or loss, (c) the payment of the liabilities, and (d) the distribution of cash to the individual partners.
MSH Company
Balance Sheet
January 31
$\begin{array} { | l | l | l | l | } \hline \text { Assets } & & \text { Liabilities and Equity } & \\\hline \text { Cash } & \$ 200,000 & \text { Accounts Payable } & \$ 221,500 \\\hline \text { Equipment } & 200,000 & \text { Masco, Capital } & 210,000 \\\hline \text { Land } & 350,000 & \text { Short, Capital } & 178,000 \\\hline & & \text { Henderson, Capital } & \\& & & 140,500 \\\hline \text { Total assets } & \$ 750,000 & \text { Total liabilities and equity } & \$ 750,000 \\\hline\end{array}$