Help! If someone could answer and explain number two the ration portion that wou

Question

Help!

If someone could answer and explain number two the ration portion that would be helpful. I have number one and think I can figure out number three.

The following additional partner transactions took place during the year:

1. In early January, Lance McGinnis is admitted to the partnership by contributing $50,000 cash for a 20% interest.

2. Net income of $250,000 was earned in 2012. In addition, Scott Wilson received a salary allowance of $45,000 for the year. The three partners agree to an income-sharing ratio equal to their capital balances after admitting McGinnis.

3. The partners' withdrawals are equal to half of the increase in their capital balances from salary allowance and income.

Prepare astatement of partnership equityfor the year ended December 31, 2012. If an amount is zero, enter in "0".

Explanation / Answer

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