(2) Prepare a schedule showing the distribution of net income, assuming net income is $20,000. (If an amount reduces the account balance then enter with a negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).) DIVISION OF NET INCOME McGill Smyth Total Salary allowance 25,000 15,000 40,000 Interest allowance T 7,200 3720 10,920 Total salaries and interest 32,200 18,720 50,920 Remaining income / deficiency Total division of net income LINK TO TEXT VIDEO: SIMILAR EXERCISE QueSLIUII 3 McGill and Smyth have capital balances on January 1 of $60,000 and $31,000, respectively. The partnership income-sharing agreement provides for (1) annual salaries of $25,000 for McGill and $15,000 for Smyth, (2) interest at 12% on beginning capital balances, and (3) remaining income or loss to be shared 60% by McGill and 40% by Smyth. Your answer is partially correct. Try again. (1) Prepare a schedule showing the distribution of net income, assuming net income is $86,000. (If an amount reduces the account balance then enter with a negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).) DIVISION OF NET INCOME McGill Smyth Total Salary allowance 25,000 15,000 40,000 Interest allowance 1 7,200 3720 10,920 Total salaries and interest 32,200 18,720 50,920 Remaining income / deficiency Total division of net income $ Your answer is partially correct. Try again. Journalize the allocation of net income in each of the situations above. (Credit account titles are automatic manually. Record entries in the order presented in the previous part.) No. Account Titles and Explanation Debit Credit 1. T Income Summary T McGill, Capital A Smyth, Capital 2. Income Summary DODOU! Income Summary = T McGill, Capital T Smyth, Capital Click if you would like to Show Work for this question: Open Show Work