Required Information [The following Information applies to the questions displayed below.] Mo, Lu, and Barb...
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Required Information [The following Information applies to the questions displayed below.] Mo, Lu, and Barb formed the MLB Partnership by making Investments of $73,800,$287,000, and $459,200, respectively. They predict annual partnership net Income of $487,500 and are considering the following alternative plans of sharing Income and loss: (a) equally; (b) In the ratio of their Inltlal capltal Investments; or (c) salary allowances of $82,800 to Mo, $62,100 to Lu, and $93,500 to Barb; Interest allowances of 10% on their Initial capital Investments; and the remaining balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb. . Prepare the December 31 journal entry to close Income Summary assuming they agree to use plan (c) and that net Income Is 487,500. Mo, Lu, and Barb withdraw $38,100,$52,100, and $68,100, respectively, at year-end. Also close the withdrawals accounts. Journal entry worksheet Record the entry to close the income summary account assuming the partners agree to use plan c and net income is $487,500. Note: Enter debits before credits
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