Glade, Marker, and Walters are partners with beginning-year capital balances of $100,000, $50,000, and $50,000, respectively. Partnership net income for the year is $84,000. Make the necessary journal entry to close Income Summary to the capital accounts if: a. Partners agree to divide income based on their beginning-year capital balances.b. Partners agree to divide income based on the ratio of 5:3:2 (Glade:Marker:Walters), respectively.c. Partners agree to divide income equally.
What will be an ideal response?
| (a) | Income Summary…………………………………… | 84,000 | ? |
| ? | Glade, Capital ($84,000 × ($100,000/$200,000))… | ? | 42,000 |
| ? | Marker, Capital ($84,000 × ($50,000/$200,000))… | ? | 21,000 |
| ? | Walters, Capital ($84,000 × ($50,000/$200,000))… | ? | 21,000 |
| ? | ? | ? | ? |
| (b) | Income Summary…………………………………… | 84,000 | ? |
| ? | Glade, Capital ($84,000 × 5/10)…………………… | ? | 42,000 |
| ? | Marker, Capital ($84,000 × 3/10)………………… | ? | 25,200 |
| ? | Walters, Capital ($84,000 × 2/10)………………… | ? | 16,800 |
| ? | ? | ? | ? |
| (c) | Income Summary…………………………………… | 84,000 | ? |
| ? | Glade, Capital ($84,000 × 1/3)…………………… | ? | 28,000 |
| ? | Marker, Capital ($84,000 × 1/3)…………………… | ? | 28,000 |
| ? | Walters, Capital ($84,000 × 1/3)………………… | ? | 28,000 |
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