CASE 2 On February 14, 2020, A is retiring from the partnership of A, B & C. The partners share profits and losses in the ration 1:2:1, respectively. On that date, a trial balance was prepared as follows: ABC Partnership Trial Balance For the period ended February 14, 2020 Cash 488,000 Accounts Receivable 250,000 Allowance for Bad Debts 12,500 Merchandise Inventory 550,000 Equipment 180,000 Accumulated Depreciation 72,000 Land 150,000 Accounts Payable 368,000 Salaries Payable 55,500 A Capital 240,000 B, Capital 420,000 C, Capital 300,000 Sales 850,000 Cost of Sales 510,000 Operating Expenses 190,000 Totals 2.318.000 2.318.000 After closing the nominal accounts, the following asset revaluations were agreed upon by the partners: 1) The allowance for bad debts should be increased to equal 8% of the accounts receivables 2) The FMV of the merchandise is 29,500 higher than its book value 3) The accumulated depreciation should be increased by 12,000 4 The FMV of the land is twice as much as its book value The operating expenses consist of all expenses incurred from the last Statement of Financial Position date (December 31, 2019) to the date of retirement (February 14, 2020) including adjustment for bad debts expense and depreciation expense for the period. The partners did not make any drawings during the period. Required: 1. Prepare entries to close the nominal accounts and to adjust the records to reflect the assets' fair market values. 2. Prepare a Statement of Financial Position 3. Prepare entries to record the retirement of partner A, assuming: a) A is paid 317.500 b) A is paid 287,500 c) A is paid 332,500