Marvel Media, LLC, has three members: WLKT Partners, Madison Sanders, and Observer Newspaper, LLC. On January 1, 20Y2, the three members had equity of $315,000, $80,000, and $190,000, respectively. WLKT Partners contributed an additional $80,000 to Marvel, Media, LLC, on June 1, 20Y2. Madison Sanders received an annual salary allowance of $182,700 during 20Y2. The members’ equity accounts are also credited with 12% interest on each member's January 1 capital balance. Any remaining income is to be shared in the ratio of 4:3:3 among the three members. The revenues, expenses, and net income for Marvel Media, LLC, for 20Y2 were $531,685, $61,685 and $470,000 respectively. Amounts equal to the salary and interest allowances were withdrawn by the members.

a). Determine the division of income among the three members. If an amount box does not require an entry, leave it blank.

b). Prepare the journal entries to close the (1) net income and (2) withdrawals to the individual member equity accounts. For a compound entry, if an amount box does not require an entry, leave it blank.

c). Prepare a statement of members' equity for 20Y2. If an amount box does not require an entry, leave it blank.

d). What are the advantages of an income-sharing agreement for the members of this LLC?

Without an income-sharing agreement, each member be credited with an equal proportion of the total earnings, or one-third each. Separate contributions be acknowledged in the income-sharing formula.

Distribution of Cash Upon Liquidation

Hewitt and Patel are partners, sharing gains and losses equally. They decide to terminate their partnership. Prior to realization, their capital balances are $24,000 and $16,000, respectively. After all noncash assets are sold and all liabilities are paid, there is a cash balance of $30,000.

a. What is the amount of a gain or loss on realization?

b. How should the gain or loss be divided between Hewitt and Patel?

c. How should the cash be divided between Hewitt and Patel? If an amount is zero, enter "0".