Required information The following information applies to the questions displayed below.] Mo Meek, Lu Ling, and Barb Beck formed the MLB Partnership by making capital contributions of $84,600, $329,000, and $526,400, respectively. They predict annual partnership net income of $550,500 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 $87,600 to Mo, $65,700 to Lu, and $99,500 to Barb; interest allowances of 10% on their initial capital investments, and the 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 $550,500 for the calendar year under each of the alternative plans being considered. (Do not round intermediate calculations.) Income (Loss) Sharing Plan Total Plan (a) Net Income (loss) Balance allocated equally Balance of income (loss) Shares to the partners Plan (b) Net Income (loss) Balance allocated in proportion to Mo Lu Barb S 550,500 S 550,500 O S Mo Lu Barb Total S 550,500 initial investments Balance of income (loss) Shares to the partners 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 S 550,500 Mo Barb Total S 550,500 Required information The following information applies to the questions displayed below. Mo Meek, Lu Ling, and Barb Beck formed the MLB Partnership by making capital contributions of $84,600, $329,000, and $526,400, respectively. They predict annual partnership net income of $550,500 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 $87,600 to Mo. $65,700 to Lu, and $99,500 to Barb; interest allowances of 10% on their initial capital investments, and the balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb. 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 $241,300, and that Mo, Lu, and Barb withdraw $45,300, $59,300, and $75,300, respectively, at year-end. (Dnot 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 Mo Lu Barb Total Initial partnership investments Net income Total net income Total Required information [The following information applies to the questions displayed below. Mo Meek, Lu Ling, and Barb Beck formed the MLB Partnership by making capital contributions of $84,600, $329,000, and $526,400, respectively. They predict annual partnership net income of $550,500 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 $87,600 to Mo, $65,700 to Lu, and $99,500 to Barb; interest allowances of 10% on their initial capital investments, and the balance shared as follows: 20% to Mo, 40% to Lu, and 40% to Barb. 3. Prepare the December 31 journal entry to close Income Summary assuming they agree to use plan (c) and that net income is $241,300. Also close the withdrawals accounts. View transaction list Journal entry worksheet Record the entry to close the income summary account assuming the partners agree to use plan(c) and net income is $241,300 Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record entry Clear entry View general journal Journal entry worksheet Record the entry to close the partners' withdrawals accounts. (Mo, Lu, and Barb withdraw $45,300, $59,300, and $75,300, respectively, at year-end.) Note: Enter debits before credits. Date General Journal Debit Credit Dec 31 Record entry Clear entry View general journal
