Exercise 12-7 (Algo) Journalizing partnership transactions LO P2 On March 1, Eckert and Kelley formed a partnership. Eckert contributed $100,000 cash, and Kelley contributed land valued at $80,000 and a building valued at $110,000. The partnership also took Kelley's $90,000 long-term note payable associated with the land and building. The partners agreed to share income as follows: Eckert gets an annual salary allowance of $29,500, both get an annual interest allowance of 12% of their initial capital investment, and any remaining income or loss is shared equally. On October 20, Eckert withdrew $32,000 cash and Kelley withdrew $25,000 cash. First year income was $82,000. Required: 1a. & 1b. Prepare journal entries to record the partners' initial capital investments and their subsequent cash withdrawals. 1c. Determine the partners' shares of income, and then prepare journal entries to close Income Summary and the partners' withdrawals accounts. ? Determine the balances of the partners' capital accounts as of December 31. Date Net Income Salary allowances Balance of income Interest allowances Balance of income Balance allocated equally Balance of income Shares of the partners Allocation of Partnership Income General Journal Record the entry to close the partners' withdrawals accounts. Dec 31 Eckert, Capital Kelley, Capital Eckert, Withdrawals Kelley, Withdrawals Record the entry to close the income summary account. Dec 31 Income summary Eckert, Capital Kelley, Capital Eckert Kelley Total $ 82,000 $ 29,500 $ 25,000 54,500 52,500 12,000 67,150 79,150 0 $ 0 $ 41,500 $ 92,150 Debit Credit 32,000 25,000 32,000 25,000 82,000