Jackson and Richard formed a partnership on 1 July 2025, agreeing to share profits and losses in the ratio of 2:1. Jackson contributed \($30\) 000 in cash and land with a fair value of \($180\) 000. Assets contributed to and liabilities assumed by the partnership from Richard’s busi­ness at both carrying amount and fair value are shown below.

During the first year, Jackson contributed an additional \($12\) 000 in cash. The partnership’s profit was \($56\) 000. Jackson withdrew \($8000\) and Richard withdrew \($16\) 000 in expectation of profits (ignore GST).
Required

(a) Prepare the journal entries to record each partner’s initial investment.

(b) Prepare the partnership’s balance sheet as at 1 July 2025.

(c) Prepare a statement of changes in partners’ equity for the year ended 30 June 2026, using method 2 for recording partners’ equity accounts.

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Carrying amount Fair value Cash at bank $22 500 $22500 Accounts receivable 12 800 12 800 Inventory 24 600 23 800 Office equipment 76 000 62 000 Accounts payable 11500 11500 Bank loan 18000 18000