Gorman and Morton form a partnership on May $1,2022.$ Gorman contributes cash of $$72,000$; Morton conveys title to the following properties to the partnership:

Book Value Fair Value

Equipment $ $26,000$ $ $50,000$

Licensing agreements $46,00058,000$

The partners agree to start their partnership with equal capital balances. No goodwill is to be recognized.

According to the articles of partnership written by the partners, profits and losses are allocated based on the following formula:

Gorman receives a compensation allowance of $$1,200$ per month.

All remaining profits and losses are split $40$:$60$ between Gorman and Morton, respectively.

Each partner can make annual cash drawings of $$5,000$ beginning in $2023.$

Net income of $$22,000$ is earned by the business during $2022.$

Steele is invited to join the partnership on January $1,2023.$ Because of her business reputation and financial expertise, she is given a $40$ percent interest for $$76,000$ cash. The bonus approach is used to record this investment, made directly to the business. The articles of partnership are amended to give Steele a $$4,000$ compensation allowance per month and an annual cash drawing of $$10,000.$ Remaining profits are now allocated:

Gorman $10\%$

Morton $50$

Steele $40$

All drawings are taken by the partners during $2023.$ At year$-$end, the partnership reports net income of $$128,000.$

On January $1,2024,$ Frank $($previously a partnership employee$)$ is admitted into the partnership. Each partner transfers $10$ percent to Frank, who makes the following payments directly to the partners:

Gorman $ $10,644$

Morton $10,412$

Steele $17,544$

Once again, the articles of partnership must be amended to allow for the entrance of the new partner. This change entitles Frank to a compensation allowance of $$1,000$ per month and an annual drawing of $$3,000.$ Profits and losses are now assigned as follows:

Gorman $12\mathrm{.}0\%$

Morton $40\mathrm{.}0$

Steele $38\mathrm{.}0$

Frank $10\mathrm{.}0$

For the year of $2024,$ the partnership earned a profit of $$58,900,$ and each partner withdrew the allowed amount of cash.

Required:

Prepare schedules that determine the capital balances for the individual partners as of the end of each year $2022$ through $2024.$