Problem 12-3A Allocating partnership income LO P2 [The following information applies to the questions displayed below.] Kara Ries, Tammy Bax, and Joe Thomas invested $22,000, $38,000, and $46,000, respectively, in a partnership. During its first calendar year, the firm earned $337,800. Prepare the entry to close the firm's Income Summary account as of its December 31 year-end and to allocate the $337,800 net income to the partners under each of the following separate assumptions: Problem 12-3A Part 1 Required: 1) The partners have no agreement on the method of sharing income and loss. View transaction list View journal entry worksheet No Date General Journal Debit Credit 1 Dec 31 337,800 Income summary Kara Ries, Capital Tammy Bax, Capital Joe Thomas, Capital 231,800 231,800 231,800 x Percentage of Total Equity Income Summary Allocated Income to Capital Supporting Computations Kara Ries Tammy Bax Joe Thomas X X X (3) The partners agreed to share income and loss by providing annual salary allowances of $33,000 to Ries, $28,000 to Bax, ar $40,000 to Thomas; granting 10% interest on the partners' beginning capital investments, and sharing the remainder equally. Ries Bax Thomas Total Supporting Calculations Net income Salary allowances Balance after salary allowances Interest allowances Balance after interest and salaries Balance allocated equally Balance of income Shares of the partners Kendra, Cogley, and Mei share income and loss in a 3:2:1 ratio. The partners have decided to liquidate their partnership. On the day of liquidation their balance sheet appears as follows. Assets Cash Inventory KENDRA, COGLEY, AND MEI Balance Sheet May 31 Liabilities and Equity $ 95, 100 Accounts payable 539,400 Kendra, Capital Cogley, Capital Mei, Capital $634,500 Total liabilities and equity $248,000 77,300 173,925 135,275 $634,500 Total assets Required: For each of the following scenarios, complete the schedule allocating the gain or loss on the sale of inventory. Prepare journal entries to record the below transactions. (Do not round intermediate calculations. Amounts to be deducted or Losses should be entered with a minus sign. Round your final answers to the nearest whole dollar.) (1) Inventory is sold for $626,400. (2) Inventory is sold for $431,400. (3) Inventory is sold for $322,200 and any partners with capital deficits pay in the amount of their deficits. (4) Inventory is sold for $273,600 and the partners have no assets other than those invested in the partnership. Required 1 Inventory Required 1 G Required 2 Inventory Required 2G) Required 3 Inventory Required 3 G) Required 4 Inventory Required 4 G) Complete the schedule allocating the gain or loss on the sale of inventory is $626,400. Step 1) Determination of Gain (Loss) Proceeds from the sale of inventory Inventory cost $ 626,400 Step 2) Allocation of the Gain (Loss) to the Partners. KENDRA Initial capital balances $ 77,300 MEI Total COGLEY $ 173,925 $ 135,275 $ 386,500 Allocation of gains (losses) Capital balances after gains (losses) Journal entry worksheet Record the sale of inventory. Note: Enter debits before credits. Transaction General Journal Debit Credit (a) Record entry Clear entry View general journal (1) Inventory is sold for $626,400. (2) Inventory is sold for $431,400. (3) Inventory is sold for $322,200 and any partners with capital deficits pay in the amount of their deficits. (4) Inventory is sold for $273,600 and the partners have no assets other than those invested in the partnership. Complete this question by entering your answers in the tabs below. Required 1 Inventory Required 1 G Required 2 Inventory Required 2G Required 3 Inventory Required 3 G) Required 4 Inventory Required 4 G) Complete the schedule allocating the gain or loss on the sale of inventory is $431,400. Step 1) Determination of Gain (Loss) Proceeds from the sale of inventory Inventory cost $ 431,400 COGLEY MEI Total Step 2) Allocation of the gain (Loss) to the Partners. KENDRA Initial capital balances $ 77,300 Allocation of gains (losses) Capital balances after gains (losses) $ 173,925 $ 135,275 $ 386,500 Required 1 Inventory Required 1 G) Required 2 Inventory Required 2G) Required 3 Inventory Required 3 G) Required Inventor Prepare journal entries to record the inventory is sold for $431,400. View transaction list Journal entry worksheet Record the sale of inventory. Note: Enter debits before credits. General Journal Debit Credit Transaction (a) Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. Required 1 Inventory Required 1 G Required 2 Inventory Required 2G) Required 3 Inventory Required 3 G) Required 4 Inventory Required 4 G) Complete the schedule allocating the gain or loss on the sale of inventory is $322,200 and any partners with capital deficits pay in the amount of their deficits. Step 1) Determination of Gain (Loss) Proceeds from the sale of inventory Inventory cost $ 322,200 COGLEY MEI Total Step 2) Allocation of the Gain (Loss) to the Partners. KENDRA Initial capital balances $ 77,300 Allocation of gains (losses) Capital balances after gains (losses) $ 173.925 $ 135,275 $ 386,500 Journal entry worksheet Record the sale of inventory. Note: Enter debits before credits. General Journal Debit Credit Transaction (a) Record entry Clear entry View general journal Dod A Sort Required 1 Inventory Required 1 G Required 2 Inventory Required 2G) Required 3 Inventory Required 3 G) Required 4 Inventory Required 4 G) Complete the schedule allocating the gain or loss on the sale of inventory $273,600 and the partners have no assets other than those invested in the partnership. Step 1) Determination of gain (loss) Proceeds from the sale of inventory Inventory Cost $ 273,600 MEI Total $ 135,275 $ 386,500 Step 2) Allocation of the gain (loss) to the partners and distribution of deficit(s) KENDRA COGLEY Initial capital balances $ 77,300 $ 173,925 Allocation of gains (losses) Capital balances after gains (losses) Allocation of deficit balance Capital balances after deficit allocation Required 1 Inventory Required 1 G) Required 2 Inventory Required 2 G Required 3 Inventory Required 3 G) Required 4 Inventory Required 4 G Prepare journal entries to record the inventory is sold for $273,600 and the partners have no assets other than those invested in the partnership. View transaction list Journal entry worksheet