On March 1, 20Y8, Eric Keene and Renee Wallace form a partnership. Keene agrees to invest $20,890 in cash and merchandise inventory valued at $56,320. Wallace invests certain business assets at valuations agreed upon, transfers business liabilities, and contributes sufficient cash to bring her total capital to $59,510. Details regarding the book values of the business assets and liabilities, and the agreed valuations, follow:

	Wallaces Ledger	Agreed-Upon
	Balance	Valuation
Accounts Receivable	$19,150	$18,230
Allowance for Doubtful Accounts	1,140	1,500
Equipment	83,410	55,190
Accumulated Depreciation	29,490
Accounts Payable	14,740	14,740
Notes Payable (current)	35,850	35,850

The partnership agreement includes the following provisions regarding the division of net income: interest on original investments at 10%, salary allowances of $22,150 (Keene) and $30,150 (Wallace), and the remainder equally.

Required:

1.

Journalize the entries on March 1 to record the investments of Keene and Wallace in the partnership accounts.*

2.

Prepare a balance sheet as of March 1, 20Y8, the date of formation of the partnership of Keene and Wallace.*

3.

After adjustments at February 28, 20Y9, the end of the first full year of operations, the revenues were $295,870 and expenses were $205,400, for a net income of $90,470. The drawing accounts have debit balances of $27,820 (Keene) and $30,550 (Wallace). Journalize the entries to close the revenues and expenses and the drawing accounts at February 28, 20Y9.*

*Refer to the Chart of Accounts and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries.