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Required information Problem 1 2 - 4 A ( Algo ) Partnership income allocation, statement of partners' equity, and closing entries LO P 2 [

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Required information
Problem 12-4A (Algo) Partnership income allocation, statement of partners' equity, and closing entries LO P2
[The following information applies to the questions displayed below.]
Mo, Lu, and Barb formed the MLB Partnership by making investments of $75,600,$294,000, and $470,400, respectively. They predict annual partnership net income of $498,000 and are considering the following alternative plans of sharing income and loss: (a) equally; (b) in the ratio of their initial capital investments; or (c) salary allowances of $83,600 to Mo,$62,700 to Lu, and $94,500 to Barb; interest allowances of 10% on their initial capital investments; and the remaining balance shared as follows: 20% to Mo,40% to Lu, and 40% to Barb.
Problem 12-4A (Algo) Part 3
3. Prepare the December 31 journal entry to close Income Summary assuming they agree to use plan (c) and that net income is $498,000. Mo, Lu, and Barb withdraw $39,300,$53,300, and $69,300, respectively, at year-end. Also close the withdrawals accounts.
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