The Mason-Dixon Partnership Was Formed on January 1, Year 1

Essay

The Mason-Dixon partnership was formed on January 1, Year 1, when Rebecca Mason and Steve Dixon contributed cash of $40,000 and $60,000, respectively. During Year 1, the partnership earned $160,000 in cash revenues and paid $108,000 in cash expenses. Mason withdrew $12,000 cash and Dixon withdrew $8,000 cash from the business. Net income was allocated to the partners' capital accounts in proportion to their initial investment in the business.Required:
Prepare an income statement, capital statement, balance sheet, and statement of cash flows for the partnership for Year 1.