Prepare journal entries to record partners cash withdrawals

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Question - ACCOUNTING: PARTNERSHIPDIRECTION: On January 1, 2019 Megan and Maria formed a partnership with Megan contributing $900,000 cash and Maria contributing land valued at $300,000 and a building valued $500,000. The partnership will assume Maria's $200,000 long term note payable associated with the land and building. The partners agree to share income on a 3:2 basis, respectively. Before the year ended, Megan and Maria withdrew cash of $30,000 and $25,000 respectively. At the end of the year, total revenues amounted to $375,000 and total operating expenses amounted to $125,000.

Required -

1. Prepare journal entries to record the partners'

a. Initial Capital Investments;

b. Cash Withdrawals; and

c. Determine Net Income and Record Share in the Profit

2. Show the Statement of Partners' Equity for the year just ended.

Reference no: EM132889514

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