Tom and Jerry decide to enter into a partnership agreement from 1 July 2028. Assets and liabilities brought into the partnership are shown below.

	Tom		Jerry
	Fair Value	Carrying Amount	Fair Value	Carrying Amount
Cash	19,200	19,200	5,000	5,000
Inventory	4,000	3,800	3,800	3,800
A/R	3,000	2,500	1,500	1,500
Equipment	65,000	55,000	30,000	25,000
A/Depre	5,500		5,000
A/P	800	800
Bank loan	50,000	50,000

Because of Jerrys exceptional talent it is agreed that his capital amount will be credited with $50,000 in total.

During the year ended 30/6/2029 the following details apply:

The partners use method 1 in their accounting

Tom will receive a salary of $50,000 p.a. and Jerry a salary of $28,000 p.a.

Partners will receive 8% p.a. interest on their opening capital balances

Partners will be charged 9% p.a. on any drawings

Tom makes drawings of $20,000 on 1 January 2029

Jerry makes drawings of $15,000 on 1 March 2029

Residual profits will be distributed Tom and Jerry on the ratio of 1:2.

Profit for the year was $76,000

Financial year ends 30 June 2029

Required:

Answer Questions a and b below:

a. Prepare the general journal entries upon the formation of the partnership.

b. Prepare a table showing calculation of distribution of profit to the partners as at 30 June 2029