Following are the adjusted account balances of Martin and

Jackson
Following are the adjusted account balances of Martin and Jackson LLP as of December 31,
the end of the fiscal year. Accounts Payable ................. $ 69,812Accounts Receivable
................ 60,143Accumulated Depreciation, Equipment ........ 47,756Allowance for Doubtful
Accounts .......... 2,192Cash 64,617 Equipment .............. 80,710Freight In .....................
27,380General Expenses (control) .............. 14,495Interest Expense ................. 2,000J. V.
Martin, Capital ................ 65,280J. V. Martin, Drawing ................ 30,192Merchandise Inventory,
December 31 ......... 128,760Notes Payable (current) .............. 16,320Prepaid Insurance
................ $ 704Purchases ................... 522,043Purchases Discounts ...............
4,516Purchases Returns and Allowances ......... 26,204Sales ...................... 761,332Sales
Returns and Allowances ........... 36,590S. C. Jackson, Capital ............... 53,040S. C. Jackson,
Drawing .............. 29,376Selling Expenses (control) .............. 36,273The merchandise inventory
at the beginning of the year was $ 141,929, and there were no changes in the partners’ Capital
accounts during the year. The partnership agreement provides for salary allowances of $
61,900 for Martin and $ 59,350 for Jackson. The agreement also stipulates an interest
allowance of 10 percent on invested capital at the beginning of the year. The remainder of the
net income is to be divided equally. Required 1. Prepare an income statement for the year. 2.
Prepare a statement of partners’ equity for the year. 3. Prepare a classified balance sheet for
the partnership at the end of the year.View Solution: Following are the adjusted account
balances of Martin and Jackson
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