Question

The ledger of Camila Ramirez and Ping Xue, attorneys at law,contains the following accounts and balances after adjustments havebeen recorded on december 31, 2014.

                                                                      Ramirez and xue Trial Balance December 31,2014

 

Debit balances

credit balances

cash

70,300

 

accounts receivable

33,600

 

supplies

5,800

 

land

128,000

 

building

175,000

 

accumulated depreciation-building

 

80,000

office equipment

42,000

 

accumulated depreciation-office equipment

 

25,300

accounts payable

 

12,400

salaries payable

 

10,000

Camila Ramirex, Capital

 

125,000

Camila Ramirez, Drawing

35,000

 

Ping Xue, Capital

 

155,000

Ping Xue, Drawing

50,000

 

Professional fees

 

555,300

Salary Expense

384,900

 

Depreciation expense, building

12,900

 

heating and lighting expense

10,500

 

depreciation expense-office equipment

6,300

 

property tax expense

3,200

 

supplies expense

3,000

 

Miscellaneous expense

2,500

 

 

963,000

963,000

         The balance inXue's capital account includes an additional investment of $20,000made on may 5, 2014.

Instructions:

1. prepare an income statement for the current fisca year,including the division of net income. the partnership agreementprovides for salary allowances of $50,000 to Ramirez and $65,000 toXue, allowances of 12% on each partners capital balance at thebegining of the fisca year, and equal division of the remaining netincome or net loss.

2. prepare a statement of partnership equity for 2014.

3. prepare a balance sheet of the end of 2014.

Thanks.