Question 2 On May 1, 2006, Nancy and Drew formed a partnership by investing $96,000 and $64,000 respectively. On May 1, 2007, the opening balances of the partner's capital accounts were $118,000 for Nancy, and $68,000 for Drew. For the fiscal year ended April 30, 2008, net income of the partnership was $50,000. During the 2008 fiscal year, Nancy withdrew $2,000 per month and Drew withdrew $1,500 per month. Profits of the partnership are to be allocated based on a 2008 salary of $40,000 for Nancy and $20,000 for Drew, with the remaining profit or loss split equally.

Required 3 a. Determine the allocation of net income for the year ended April 30, 2008.

3 b. Prepare a statement of partners' capital for the year ended April 30, 2008