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 3:2. 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. Question Content Area a. Determine the division of $148,000 net income for the year. Schedule of Division of Net Income Farley Clark Total Salary allowance $fill in the blank 996889042f95077_1 $fill in the blank 996889042f95077_2 $fill in the blank 996889042f95077_3 Remaining income fill in the blank 996889042f95077_4 fill in the blank 996889042f95077_5 fill in the blank 996889042f95077_6 Net income $fill in the blank 996889042f95077_7 $fill in the blank 996889042f95077_8 $fill in the blank 996889042f95077_9 Question Content Area b. Provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the two members. If an amount box does not require an entry, leave it blank. (1) Revenues Revenues Martin Farley, Drawing Martin Farley, Drawing Ashley Clark, Drawing Ashley Clark, Drawing - Select - - Select - (2) - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select -

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question Content Area

a. Determine the division of $148,000 net income for the year.

Schedule of Division of Net Income

	Farley	Clark	Total
Salary allowance	$fill in the blank 996889042f95077_1	$fill in the blank 996889042f95077_2	$fill in the blank 996889042f95077_3
Remaining income	fill in the blank 996889042f95077_4	fill in the blank 996889042f95077_5	fill in the blank 996889042f95077_6
Net income	$fill in the blank 996889042f95077_7	$fill in the blank 996889042f95077_8	$fill in the blank 996889042f95077_9

Question Content Area

b. Provide journal entries to close the (1) revenues and expenses and (2) drawing accounts for the two members. If an amount box does not require an entry, leave it blank.

(1)	Revenues	Revenues
	Martin Farley, Drawing	Martin Farley, Drawing
	Ashley Clark, Drawing	Ashley Clark, Drawing
	- Select -	- Select -
(2)	- Select -	- Select -
	- Select -	- Select -
	- Select -	- Select -
	- Select -	- Select -