The partnership of Robo and Swing, CPAs, reported revenues of $215,000 and expenses of $80,000 on their year-end work sheet. Their capital balances as of January 1, 20--, were $55,000 for I. Robo and $45,000 for B. Swing. No additional investments were made during the year. As stated in their partnership agreement, after withdrawing salary allowances of $65,000 for Robo and $35,000 for Swing, the partners each withdrew their full 10% interest allowances on their January 1 capital balances. No additional withdrawals were made. Any remaining net income is to be divided on a 4555 basis.
1. Prepare the lower portion of the income statement of the partnership for the year ended December 31, 20--, showing the division of the partnership net income for the year.
2. Prepare a statement of partners' equity for the year ended December 31, 20--, and the partners' equity section of the balance sheet on that date.
3. Prepare closing entries for the partnership as of December 31, 20--. (For simplicity, use the account titles "Revenues" for all revenues and "Expenses" for all expenses.)