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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 [
Required information
Problem A Algo Partnership income allocation, statement of partners' equity, and closing entries LO P
The following information applies to the questions displayed below.
Mo Lu and Barb formed the MLB Partnership by making investments of $$ and $ respectively. They predict annual partnership net income of $ and are considering the following alternative plans of sharing income and loss: a equally; b in the ratio of their initial capital investments; or c salary allowances of $ to $ to and $ to Barb; interest allowances of on their initial capital investments; and the remaining balance shared as follows: to to and to Barb.
Problem A Algo Part
Prepare the December journal entry to close Income Summary assuming they agree to use plan c and that net income is $ Mo Lu and Barb withdraw $$ and $ respectively, at yearend. Also close the withdrawals accounts.
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