On April 1, 2020, Harry Regal and Meghan Merle formed a partnership in Alberta, renting reusable moving boxes.

Net Income during the year was $177,000 and was in the Income Summary account.

Required

1. Present general journal entries to record the initial capital investments of the partners, their cash withdrawals, and the December 31 closing of the Income Summary and withdrawals accounts.

2. Determine the balances of the partners? capital accounts as of the end of 2020.

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Regal Merle 137,000 land 50,000 building 15% of original capital investments 97,000 cash 107,000 salary allowance 15% of original capital investments Contribution Profit sharing Balance shared equally Cash withdrawal during year 77,000 62,000