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Required information [The following information applies to the questions displayed below.] Mo, Lu, and Barb formed the MLB Partnership by making investments of $85,500, $332,500,

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Required information [The following information applies to the questions displayed below.] Mo, Lu, and Barb formed the MLB Partnership by making investments of $85,500, $332,500, and $532,000, respectively. They predict annual partnership net income of $555,000 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 $88,000 to Mo, $66,000 to Lu, and $100,000 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. Required: 1. Use the table to show how to distribute net income of $555,000 for the calendar year under each of the alternative plans being considered. (Do not round intermediate calculations.) Income (Loss) Sharing Plan - Lu Barb Mo Plan (a) Net Income (loss) Balance allocated equally Balance of income (loss) Shares to the partners Barb Lu Mo Plan (b) Total $ 555,000 Total S 555.000 ce The Tanie to snow now to istnine nat income a raiannar upar unnar oarn not the sarnameniane nenn Required information Income (Loss) Sharing Plan Plan (a) Mo Lu Barb Net Income (loss) Balance allocated equally Balance of income (loss) Shares to the partners Plan (b) Lu Barb Net Income (loss) Balance allocated in proportion to initial investments Balance of income (loss) Shares to the partners Lu Barb Plan (c) Net income (loss) Salary allowances Balance of income (loss) Interest allowances Balance of income (loss) Balance allocated Balance of income (loss) Shares of the partners Mo Mo Check my work Total S 555.000 Total 1 555.000 Total S 555.000 3 2. Prepare a statement of partners' equity showing the allocation of income to the partners assuming they agree to use plan (c), that income earned is $555,000; and that Mo, Lu, and Barb withdraw $46,000, $60,000, and $76,000, respectively, at year-end. (Do not round intermediate calculations. Enter all allowances as positive values. Enter losses as negative values.) MLB PARTNERSHIP Statement of Partners' Equity " For Year Ended December 31 Lu Mo Barb Total Initial partnership investments Net income Total net income Total ces Naud Journal entry worksheet 1 2 Record the entry to close the income summary account assuming the partners agree to use plan c and net income is $555,000. Note: Enter debits before credits. Date General Journal Debit Credit December 31 View general journal Clear entry Record entry Required information Journal entry worksheet

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