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Mike and Rachel form M&R Partnership. Mike invests $42,000 cash and Rachel invests...

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Accounting

Mike and Rachel form M&R Partnership. Mike invests $42,000 cash and Rachel invests $62,000 cash. The partners agree to share income as follows: Mike gets a salary allowance of $5,000 per year and Rachel gets a salary allowance of $9,200 per year; both get an annual interest allowance of 10% on their initial investment; and any remaining balance is shared equally. Net income for the year is $32,000. Also, Mike withdrew $1,200 cash from the partnership and Rachel withdrew $2,200.
Prepare a statement of partners' equity for the year ended December 31.
Note: Do not round intermediate calculations. Enter all allowances as positive values. Enter losses and withdrawals as negative values.
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