1. Summers and Winters formed a partnership on January 1. Summers contributed $90.000 cash and equipment with a market value of $60.000. Winters' investment consisted of cash. $30,000; inventory, $20,000; all at market values. Partnership net income for year 1 and year 2 was $75,000 and $120.000, respectively. a Determine each partner's share of the net income for each year, assuming each of the following independent situations: (1) Income is divided based on the partners' failure to sign an agreement. (2) Income is divided based on a 2:1 ratio (Summers: Winters). (3) Income is divided based on the ratio of the partners' original capital investments. (4) Income is divided based on interest allowance of 12% on the original capital investments; salary allowance to Summers of $30,000 and Winters of $25,000; and the remainder to be divided equally. b. Prepare the journal entry to record the allocation of the Year 1 income under alternative (4) above. 2. Brit. Franc. and Scot who share income and loss in a 2.2:1 ratio, 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. Assets Cash Equipment Land $150,000 200,000 400,000 Brit, Franc, and Scot Balance Sheet January 31 Liabilities and Equity Accounts Payable Brit, Capital Franc, Capital Scot, Capital Total liabilities and equity $221,500 210,000 178,000 140,500 $750.000 Total assets $750,000