Exercise 12-04 a-b (Video) McGill and Smyth have capital balances on January 1 of $52,000 and $45,000, respectively. The partnership income-sharing agreement provides for (1) annual salaries of $15,000 for McGill and $11,000 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. (1) Prepare a schedule showing the distribution of net income, assuming net income is $80,000. (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 $ $ Interest allowance Total salaries and interest Remaining income / deficiency Total division of net income (2) Prepare a schedule showing the distribution of net income, assuming net income is $29,000. (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 $ $ Interest allowance Total salaries and interest Remaining income / deficiency Total division of net income Journalize the allocation of net income in each of the situations above. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record entries in the order presented in the previous part.) No. Account Titles and Explanation Debit Credit 1. 2. w Work for this question: Open Show Work VIDEO: SIMILAR EXERCISE Click Income Summary Accounts Payable McGill, Capital LIN Drawings Net Income Smyth, Capital Cash Accounts Receivable Salaries Expense Question Attempts: 0 of 5 used