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McGill and Smyth have capital balances on January 1 of $50,000 and $40,000 respectively ....

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Accounting

McGill and Smyth have capital balances on January 1 of $50,000 and $40,000 respectively . The partnership income sharing agreements provides for (1) annual salaries of $22,000 for Mcgill and $13,000 for Smyth (2) interest at 10% on beginning capital balances and (3) remaining income or loss to be shared 60% by McGill and 40% by Smyth . (a) Prepare a schedule showing the distribution of net income assuming net income is (1)$50,000 and (2) $ 36,000 (b) Journalize the allocation of net income in each of the situation above .

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