After closing the revenue and expense accounts, the profit for the year ending December 31, 2017 of the Mitt & Ryan partnership is $25,900. The partnership agreement specifies that profits and losses will be shared using the following formula.

1. Allocate profit by a 5% interest allowance on the partners’ beginning capital balances.
2. Allocate salary allowances of $18,800 to Mitt and $13,200 to Ryan.
3. Remaining profit (loss) is to be shared on a ratio of 8:5.

At the beginning of the year, Mitt's capital account had a balance of $31,400 and Ryan's capital account had a balance of $34,000. Mitt withdrew $1,050 cash per month while Ryan withdrew $1,250 per month from the partnership. During the year, Mitt made an additional investment of $5,600 cash into the partnership.

Required:

Prepare a schedule to show how the profit or loss will be allocated to the two partners.

Prepare a statement of partners' equity for the year.

Prepare the remaining closing entries on December 31