Allocation of Profit/Loss among Partners.

Read the following information about Smartway Associates having two partners David and Kathy.

As per the partnership deed every year:

a) David gets $20,000 and Kathy gets $40,000 as Salary Allowances.

b) David gets $5000 as interest allowances and Kathy gets $ 1,000.

c) Profits/losses are to be shared equally between the partners.

d) Net Profit for the year ended Dec 31st 2020 is $200,000.

REQUIRED

A) Statement of Allocation of Profit/Loss to Partners

B) Journal Entry to close the Income Summary Account to the Partners Capital Account