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Wallace and Simpson formed a partnership with Wallace contributing $78,000 and Simpson contributing $58,000. Their partnership agreement calls for the income (loss) division to be
Wallace and Simpson formed a partnership with Wallace contributing $78,000 and Simpson contributing $58,000. Their partnership agreement calls for the income (loss) division to be based on the ratio of capital investments. The partnership had income of $170,000 for its first year of operation. When the Income Summary is closed, the journal entry to allocate partner income is:
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