The ledger of Amid Moshref and Alex Weekley, attorneys-at-law, contains the following accounts and balances after adjustments have been recorded on December 31, 2010:

The balance in Weekley’s capital account includes an additional investment of $20,000 made on April 5, 2010.

Instructions

1. Prepare an income statement for the current fiscal year, indicating the division of net income. The articles of partnership provide for salary allowances of $60,000 to Moshref and $75,000 to Weekley, allowances of 12% on each partner’s capital balance at the beginning of the fiscal year, and equal division of the remaining net income or net loss.

2. Prepare a statement of partners’ equity for 2010.

3. Prepare a balance sheet as of the end of 2010.

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Debit Balances Credit Balances Cash 24,200 41,300 6,700 120,000 160,000 Accounts Receivable Supplies Land Building Accumulated Depreciation-Building Office Equipment Accumulated Depreciation-Office Equipment Accounts Payable Selaries Payable Amid Moshref, Capital Amid Moshref, Drawing Alex Weekley, Capital Alex Weekley, Drawing Professional Fees 52,300 53,000 21,300 3,400 5,200 125,000 50,000 160,000 60,000 562,200 Salary Expense Depreciation Expense Building Property Tax Expense Heating and Lighting Expense Supplies Expense Depreciation Expense-Office Equipment Miscellaneous Expense 312,300 75,000 3,500 11,200 3,400 6,700 2,100 929,400 929,400