Dividing LLC Income

Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $63,000 and $50,000 to each member, respectively. In addition, the operating agreement specified an income-sharing ratio of 3:1. The two members withdrew amounts equal to their salary allowances. Revenues were $668,000 and expenses were $520,000, for a net income of $148,000.

a. Determine the division of $148,000 net income for the year.

Schedule of Division of Net Income

	Farley	Clark	Total
Salary allowance	$fill in the blank f50fedf53ffd07a_1	$fill in the blank f50fedf53ffd07a_2	$fill in the blank f50fedf53ffd07a_3
Remaining income	fill in the blank f50fedf53ffd07a_4	fill in the blank f50fedf53ffd07a_5	fill in the blank f50fedf53ffd07a_6
Net income	$fill in the blank f50fedf53ffd07a_7	$fill in the blank f50fedf53ffd07a_8	$fill in the blank f50fedf53ffd07a_9

b. Provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the two members. If an amount box does not require an entry, leave it blank.

(1)	Ashley Clark, DrawingAshley Clark, Member EquityMartin Farley, DrawingMartin Farley, Member EquityRevenues	- Select -	- Select -
	Ashley Clark, DrawingCashExpensesMartin Farley, DrawingRevenues	- Select -	- Select -
	Ashley Clark, DrawingCashMartin Farley, DrawingMartin Farley, Member EquityRevenues	- Select -	- Select -
	Ashley Clark, DrawingAshley Clark, Member EquityMartin Farley, DrawingRevenuesSalary Expense	- Select -	- Select -
(2)	Ashley Clark, DrawingCashMartin Farley, DrawingMartin Farley, Member EquityRevenues	- Select -	- Select -
	Ashley Clark, DrawingAshley Clark, Member EquityMartin Farley, DrawingRevenuesSalary Expense	- Select -	- Select -
	Ashley Clark, Member EquityCashMartin Farley, DrawingMartin Farley, Member EquityRevenues	- Select -	- Select -
	Ashley Clark, DrawingAshley Clark, Member EquityMartin Farley, Member EquityRevenuesSalary Expense	- Select -	- Select -