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A partnership begins its first year of operations with the following capital balances: Allegan, Capital $ 9 2 , 0 0 0 Berrien, Capital 8
A partnership begins its first year of operations with the following capital balances:
Allegan, Capital $
Berrien, Capital
Kent, Capital
According to the articles of partnership, all profits will be assigned as follows:
Allegan will be awarded an annual salary of $ with $ assigned to Kent.
The partners will be attributed interest equal to percent of the capital balance as of the first day of the year.
The remainder will be assigned on a :: basis, respectively.
Each partner is allowed to withdraw up to $ per year.
The net loss for the first year of operations is $ and net income for the subsequent year is $ Each partner withdraws the maximum amount from the business each period.
Required:
Prepare schedules that compute the balances in each partner's capital account at the end of each of the first two years of partnership operations.
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