Problem 12-5A Liquidation of a partnership LO P4 Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows KENDRA, COGLEY, AND ME Balance Sheet May 31 Liabilities and Equity Assets Cash Inventory $ 91,700 Accounts payable 538,800 Kendra, Capital $ 247,000 76,700 172,575 134,225 Cogley, Capital Mei, Capital Total assets $ 630,500 Total liabilities and equity $ 630,500 Required For each of the following scenarios, complete the schedule allocating the gain or loss on the sale of inventory. Prepare journal entries to record the below transactions. (Do not round intermediate calculations. Amounts to be deducted should be entered with a minus sign.) (1) Inventory is sold for $608,400 Step 1) Determination of gain (loss) Proceeds from the sale of inventory Inventory Cost Gain on sale Step 2) Allocation of the gain (loss) to the partners $ 608,400 538,800 69,600 KENDRA COGLEY MEI Total $172,575 Initial capital balances Allocation of gains (losses) Capital balances after gains (losses) 76,700 34,800 $111,500 $134,225 $383,500 69,600 $ 145,825 $ 453,100 23,200 11,600 $195,775