Instructions: 1. Prepare the ten-column worksheet. 2. Prepare the income statement, a statement of changes in partner's equity, and a statement of financial position. 3. Prepare the adjusting and closing entries as of December 31,2014.

Problem 3-7 ( Work sheet; Financial Statements; Adjusting and Closing Entrie The account balances in the books of Be on Top Partnership at the end of its firs operations on December 31, 2014 are as follows: Accounts Payable 756,000 Accounts Receivable 186,000 Bathan, Capital 600,000 Bathan, Drawing 144,000 Buenas, Capital 489.000 Buenas, Drawing 54,000 Cash 582.750 General Expenses - - Others 756,000 Interest Expense 26,250 Interest Income 21,000 Notes Payable 360.000 Notes Receivable 120.000 Purchases 4,920.000 Purchases Discount 138,000 Purchases Returns and Allowances 99,000 Sales 5.100.000 Sales Salaries 480,000 Store Furniture 222.000 Store Supplies 36,000 36.000 Taxes As the person in-charge of the preparation of financial statements, you gathered the Allowing data that require adjustments as of December 31, 2014 and the information relating to division of partnership profit or loss: 1. Inventories: merchandise. P1,406,000; supplies, P16,500. 2. Depreciation of store furniture, 10% a year. made on March 1 costing P54,000. Additions to store furniture were 3. Accrued advertising, P9.500. 4. Prepaid taxes, P10.000 5 . Accrued taxes, P10.500 6. Accrued interest on notes payable, P3.750 7. Accrued Interest on notes receivable, P6,000 S. Uncollectible accounts receivable, P9.300 9. Income taxes, 30% 10. Bathan and Buenas agree to divide earnings as follows: a. Interest at 10% on beginning capital balances b. Salaries to the managing partner Bathan of P100,000 c. Remaining profit or loss to be divided equally Instructions: 1. Prepare a ten-column worksheet. 2 . Prepare an income statement, a statement of changes in partners' equity, and a statement of financial position. 3. Prepare the adjusting and closing entries as of December 31, 2014