2 Inome Distribution During year 2, 2017- the following T accounts show the activity in the partners' Capital and Withdrawal accounts: On May 1, 2017 - HH withdrew $45,000 and JR withdrew $25,000 HH Capital JR Capital 216 540 124 460 HH Drawings 45,000 R Drawings 25,000 1-May HH's additional capital contributions during the year is as follows: Date Contribution 16,000 12,000 11/30/17 $ 24,000 JR's additional capital contributins during the year is a follows: Date Contribution 12,000 12,000 24,000 11/30/17$ Assume the partnership agreement states that profits and losses will be distributed as follows: 1. JR will receive an annual salary of $30,000 2. Each partner receives a 20% interest on their weighted average capital balances: 3, JR gets a bonus of 15% on net income over $50,000 4. HH and JR share remaining profits and losses equally (50:50) 1. Calculate the weighted average capital balance for each partner (Hint: use same method used for calculation of weighted average of outstanding stocks) 2. Calculate the distribution of the income or loss generated under the following assumptions: a) The partnership had a net income of $150,000 at the end of 2017, how much is distributed to JR b) The partnership had a net income of $75,000 at the end of 2017, how much is distributed to HH c) The partnership had a net loss of $20,000 at the end of 2017, what is each partner's capital balance after distribution of the loss d) Prepare the closing entries for both capital and withdrawal accounts as of Dec. 31, 2017 under each independent scenario 2 Inome Distribution During year 2, 2017- the following T accounts show the activity in the partners' Capital and Withdrawal accounts: On May 1, 2017 - HH withdrew $45,000 and JR withdrew $25,000 HH Capital JR Capital 216 540 124 460 HH Drawings 45,000 R Drawings 25,000 1-May HH's additional capital contributions during the year is as follows: Date Contribution 16,000 12,000 11/30/17 $ 24,000 JR's additional capital contributins during the year is a follows: Date Contribution 12,000 12,000 24,000 11/30/17$ Assume the partnership agreement states that profits and losses will be distributed as follows: 1. JR will receive an annual salary of $30,000 2. Each partner receives a 20% interest on their weighted average capital balances: 3, JR gets a bonus of 15% on net income over $50,000 4. HH and JR share remaining profits and losses equally (50:50) 1. Calculate the weighted average capital balance for each partner (Hint: use same method used for calculation of weighted average of outstanding stocks) 2. Calculate the distribution of the income or loss generated under the following assumptions: a) The partnership had a net income of $150,000 at the end of 2017, how much is distributed to JR b) The partnership had a net income of $75,000 at the end of 2017, how much is distributed to HH c) The partnership had a net loss of $20,000 at the end of 2017, what is each partner's capital balance after distribution of the loss d) Prepare the closing entries for both capital and withdrawal accounts as of Dec. 31, 2017 under each independent scenario