Starting Question Journal Final Question Instructions Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $36,200 and $30,700 to each member, respectively. In addition, the operating agreement specified an income-sharing ratio of 3:1. The two members withdrew amounts equal to their salary allowancos. Revenues word $668,000 and expenses were $520,000, for a net income of $148,000. Note: The reduction in members' equity from withdrawals would be disclosed on the statement of members' equity. Required: A. Determine the division of $148,000 net income for the year B. on December 31, provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the two members. Hefer to the Chart of Accounts for exact wording of account titles C. the net income was less than the sum of the salary allowances, how would income be divided between the two members of the LLC Martin Farley and Ashley Clark formed a limited liability company Wur an opera In Starting Question y alon ex Na A. Determine the division of $148,000 net income for the year. Farley Clark Total $ Salary allowance Remaining income Drs. Refe Net Income $ the LLC Journal B. On December 31, provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the two members. Heter to the Chart of Accounts for exact wording of account blos. PAGE 11 JOURNAL ACCOUNTING EQUATION DATE POSTER DEBIT CREDIT ASSETS LABILITIES EQUITY DESCRIPTION Closing Entries 1 2 Instructions Final Question C. If the net income was less than the sum of the salary allowances, how would income be divided between the two members of the LLC? In the net income of the LLC was less than the sum of the salary allowances, both members would still be with their salary allowances. From this amount, each partner would his or her share of the excess of the total salary allowance over the net income. Thus, the difference between the net income and total salary allowances would be allocated to ench partner as a according to the incomo-sharing ratio