Question

sold office equipment for 135000

NW2 Onbecher + Assignment/takeAssignment Main.do invokerStakeAssignmentSession Locator Binprogress-false look Dividing Lic Income Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $56,000 and $45,000 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 allowances. Revenues were $668.000 and expenses were $520,000, for a net income of $140,000. a. Determine the division of $148,000 net income for the year Schedule of Division of Net Income Set up a column for each partner and a total column Allocate a c este distribute the remaining income based on the income sharing agreement b. Provide journal entries to dose the (1) revenues and expenses and (2) drawing accounts for the two members. For a compound transaction. If an amount box does not require an entry, leave it blank. Previous Next Al work evet meretractors sutrit pasirene insert backspace

Answer 1

Answer:

Salary Allowance Remaining Income Net Income Farley Clark $56,000||$45,000 $35,250 || $11,750 $91,250 $56,750 Total $101,000 $47,000 $148,000

Remaining income = 148000 - 101000 = $47,000

As per operation agreement remaining income is to be shared between Farley and Clark at ratio of 3:1

So:

Farley's share of remaining income = 47000 * 3 / (3 +1) = $35,250

Clark's share of remaining income = 47000 * 1 / (3 +1) = $11,750