E12.4 Prepare schedule showing distribution of net income and closing entry McGill and Smyth have capital balances on January 1 of $50,000 and $40,000, respectively. The partnership income-sharing agreement provides for (1) annual salaries of $22,000 for McGill and $13,000 for Smyth, (2) interest at 10% on beginning capital balances, and (3) remaining income or loss to be shared 60% by McGill and 40% by Smyth. Instructions (a) Prepare a schedule showing the distribution of net income, assuming net income is (1) $50,000 and (2) $36,000. (b) Journalize the allocation of net income in each of the situations above. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?". (a)(1) DIVISION OF NET INCOME McGill Smyth Total Salary allowance Value Value Value Interest allowance McGill ? Smyth ? Total interest ? Total salaries and interest ? ? ? Remaining income McGill ? Smyth ? Total remainder ? Total division of net income ? ? ? (a)(2) DIVISION OF NET INCOME McGill Smyth Total Salary allowance Value Value Value Interest allowance ? ? ? Total salaries and interest ? ? ? Remaining deficiency McGill ? Smyth ? Total remainder ? Total division of net income ? ? ? (b)(1) Account Account Account Value Value Value (b)(2) Account Value Account Value Account Value