Faith Busby and Jeremy Beatty started the B&B partnership on January 1, Year 1. The business
acquired $104,000 cash from Busby and $156,000 from Beatty. During Year 1, the partnership
earned $66,300 in cash revenues and paid $31,250 for cash expenses. Busby withdrew $2,300
cash from the business, and Beatty withdrew $3,400 cash. The net income was allocated to the
capital accounts of the two partners in proportion to the amounts of their original investments in
the business.
Required
Prepare an income statement, capital statement (statement of changes in equity), balance sheet,
and statement of cash flows for B&Bs Year 1 fiscal year. Prepare the income statement.
Prepare a capital statement.
Prepare a balance sheet. (Do not round intermediate calculations and round your final answer to
the nearest wl amount.)
Prepare a balance sheet. (Do not round intermediate calculations and round your final answer to
the nearest wl amount.)