Dividing Partnership Net Income Required: Steve King and Chelsy Poodle formed a partnership, dividing income as follows: 1. Annual salary allowance to Poodle of $152,880. 2. Interest of 5% on each partner's capital balance on January 1. 3. Any remaining net income divided to King and Poodle, 1:2. King and Poodle had $54,000 and $75,000, respectively, in their January 1 capital balances. Net income for the year was $273,000. How much is distributed to King and Poodle? Note: Compute partnership share. King: $ Poodle: $ Revaluing and Contributing Assets to a Partnership Demarco Lee invested $38,000 in the Camden & Sayler partnership for ownership equity of $38,000. Prior to the investment, equipment was revalued to a market value of $297,000 from a book value of $240,000. Kevin Camden and Chloe Sayler share net income in a 1:2 ratio. Required: a. Provide the journal entry for the revaluation of equipment. For a compound transaction, if an amount box does not require an entry, leave it blank. b. Provide the journal entry to admit Lee. Accounts Payable Accounts Receivable Cash Demarco Lee, Drawing Demarco Lee, Capital Liquidating Partnerships Prior to liquidating their partnership, MacPherson and Ericson had capital accounts of $58,000 and $114,000, respectively. Prior to liquidation, the partnership had no cash assets other than what was realized from the sale of assets. These partnership assets were sold for $150,000. The partnership had $5,000 of liabilities. MacPherson and Ericson share income and losses equally. Determine the amount received by MacPherson as a final distribution from liquidation of the partnership. $ 72,500 x Feedback Check My Work 1. Begin with MacPherson equity prior to liquidation. 2. Adjust the equity for the gain or loss on the sale of the assets. 3. Allocate the gain/loss to partner capital accounts based on the income-sharing ratio. 4. Add beginning equity plus allocated gain/loss to determine liquidation distribution