PROBLEM 18 (18 pts.)
Partners Conner, Tuitt, and Heyward share profits and losses in a 3:4:5 ratio, respectively. Their average capital balances for the quarter year were $50,000, $70,000, and $80,000, respectively.
Conner and Heyward each receive a salary of $8,000 each quarter due to their years of experience
in the field. All three partners receive 5% interest on their average capital balance. The net income
for this quarter was $25,100.
Prepare a schedule that shows the distribution of the net income to the partners.
PROBLEM 19 (8 pts.)
Partners Mendenhall and Bettis share profits and losses in a 3:5 ratio. Lipps is admitted as a new
partner when he invests $40,000 for 30% ownership in the business. The current partners'
capital account balances are:
Mendenhall $45,000 Bettis $65,000

Prepare the journal entry to admit Lipps to the partnership.