Reference no: EM133000131

JD Partners was formed on 1 October 2011. Jodie invested $150,000 and David invested $100,000.

The partnership agreement contained the following provisions:

• Salaries are paid on the basis of $65,000 to Jodie and $60,000 to David.
• Interest on drawings and advances are charged at 6% per annum.
• Residual profits are divided proportionately on the basis of the partners' initial capital contribution.

Other information:

• On 1 January David advanced $20,000 to the partnership.
• Both partners withdrew capital in anticipation of profits:

Jodie (1 March 2012) $8,600

David (30 April 2012) $12,000

• Net Profit at 30 June 2012 amounted to $147,000.

Required:

Problem a) Provide a schedule showing the distribution of profit to each partner (round to the nearest dollar)

Problem b) Provide the Equity section of the Balance Sheet using fixed capital accounts.