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Ill thumbs up!! please step by step Problem V: The following...

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Accounting

Ill thumbs up!! please step by step

Problem V:

The following information is available concerning the agreement for income/(loss) distribution of the Earth, Wind & Fire partnership for 2019:

Income to be awarded based on labor: Earth, $10,000; Wind $20,000; Fire, $25,000.

Interest is to be awarded based on a 10% return on capital. Earths capital is $100,000; Winds capital is $40,000; and Fires capital is $50,000.

The remainder is to be allocated on 2:1:1 basis.

REQUIRED:

1) Prepare a schedule of income distribution if 2019 net income was $150,000.

2) Prepare a schedule of income distribution if there was a LOSS of ($10,000) in 2019.

Problem VI:

The partnership of DeGrom, Syndergaard, and Peterson have respective capital balances of $130,000, $100,000, and $70,000. The firm decides to expand their partnership by deciding to admit Lugo who agrees to contribute $100,000 for a 20% equity stake. The old partners share profits and losses 2:1:1.

Required:

Prepare the journal entry to record Lugos admission into the partnership.

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