division of income -accounting?

Question

The levin and Motes partnership reports net income of $60,000. Partner salary allowances are Levin $25,000 and Motes $20,000. No intrest allowance will be used. Any remaining income is shared 60:40 ratio.


Determine the amount of net income allocated to each partner:

Salary allowance:
Intrest allowance: 0 0 0
Total Salaries and Intrest
Remaining
Levin
Motes
Total Division of income



Prepare the General Journal entry to close the income summary account into partnership equity accounts



I need help with this one!!

Answer 1

Salary allowance: $45,000
Intrest allowance: 0 0 0
Total Salaries and Interest : $45,000
Remaining : $15,000 to be shared
Levin : $9,000
Motes : $6,000
Total Division of income : $60,000

Prepare the General Journal entry to close the income summary account into partnership equity accounts
Dr Income summary $60,000
Cr Levin's equity a/c $34,000 (salary $25k + share of income $9k)
Cr Motes' equity a/c $26,000 (salary $20k + share of income $6k)