Dividing LLC Income Instructions Chan of Accounts euinalFr Qestion Starting Quesien Instructions Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $36,400 and $28,100 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 $148,000. Note: The reduction in members' equity from withdrawals would be disclosed on the statement of members equity. Required: A. Determine the division of $148,000 net income for the year. B. On December 31, provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the wo members. Refer to the Chart of Accounts for exact wording of account titdes. C. If the net income was less than the sum of the salary allowances, how woufd income be divided between the two members of the LLC2 Next, Previous 3 more Check My Work uses remaining. Check My Work
Dividing LLC Income Instructions Chan of Accounts euinalFr Qestion Starting Quesien Instructions Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $36,400 and $28,100 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 $148,000. Note: The reduction in members' equity from withdrawals would be disclosed on the statement of members equity. Required: A. Determine the division of $148,000 net income for the year. B. On December 31, provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the wo members. Refer to the Chart of Accounts for exact wording of account titdes. C. If the net income was less than the sum of the salary allowances, how woufd income be divided between the two members of the LLC2 Next, Previous 3 more Check My Work uses remaining. Check My Work
College Accounting, Chapters 1-27
23rd Edition
ISBN:9781337794756
Author:HEINTZ, James A.
Publisher:HEINTZ, James A.
Chapter19: Accounting For Partnerships
Section: Chapter Questions
Problem 3SEA
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Transcribed Image Text:Dividing LLC Income
Instructions
Chan of Accounts
euinalFr Qestion
Starting Quesien
Instructions
Martin Farley and Ashley Clark formed a limited liability company with an operating agreement that provided a salary allowance of $36,400 and $28,100 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 $148,000.
Note: The reduction in members' equity from withdrawals would be disclosed on the statement of members equity.
Required:
A. Determine the division of $148,000 net income for the year.
B. On December 31, provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the wo members. Refer to
the Chart of Accounts for exact wording of account titdes.
C. If the net income was less than the sum of the salary allowances, how woufd income be divided between the two members of the LLC2
Next,
Previous
3 more Check My Work uses remaining.
Check My Work
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