Jakobs, Penn, and Lundt are partners with beginning-of-year capital balances of $400,000, $320,000, and $160,000, respectively. The partners agreed to share income and loss as follows: Salary of $30,000 to Jakobs, $50,000 to Penn, and $36,000 to Lundt. An interest allowance of 8% on beginning-of-year capital balances. Any remaining balance is to be divided equally. If partnership net income for the year is $190,000, determine each partner's share and make the appropriate journal entry to close the Income Summary to the capital accounts.
What will be an ideal response?
| ? | Jakobs | Penn | Lundt | Allocated |
| Income | ? | ? | ? | $190,000 |
| Salary allowance | $30,000 | $50,000 | $36,000 | (116,000) |
| Interest at 8% | 32,000 | 25,600 | 12,800 | (70,400) |
| Remainder | ? | ? | ? | $3,600 |
| Balance allocated | 1,200 | 1,200 | 1,200 | ($3,600) |
| Total | $63,200 | $76,800 | $50,000 | $0 |
| Income Summary …………………………………………… | 190,000 |
| Jakobs, Capital ………………………………………… | 63,200 |
| Penn, Capital ………………………………………….. | 76,800 |
| Lundt, Capital …………………………………………. | 50,000 |
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