ries, bax, and thomas invested $30,000, $46,000, and $54,000, respectively, in a partnership. during its…

ries, bax, and thomas invested $30,000, $46,000, and $54,000, respectively, in a partnership. during its first calendar year, the firm earned $317,700.\nrequired:\nprepare the entry to close the firm’s income summary account as of its december 31 year - end and to allocate the $317,700 net income under each of the following separate assumptions.\nproblem 12 - 3a (algo) part 3\n3. the partners agreed to share income and loss by providing annual salary allowances of $30,000 to ries, $25,000 to bax, and $37,000 to thomas; granting 10% interest on the partners’ beginning capital investments; and sharing the remainder equally.\ncomplete this question by entering your answers in the tabs below.\nappropriation of profits general journal\nallocate $317,700 net income by providing annual salary allowances of $30,000 to ries, $25,000 to bax, and $37,000 to thomas; granting 10% interest on the partners’ beginning capital investments; and sharing the remainder equally.

ries, bax, and thomas invested $30,000, $46,000, and $54,000, respectively, in a partnership. during its first calendar year, the firm earned $317,700.\nrequired:\nprepare the entry to close the firm’s income summary account as of its december 31 year - end and to allocate the $317,700 net income under each of the following separate assumptions.\nproblem 12 - 3a (algo) part 3\n3. the partners agreed to share income and loss by providing annual salary allowances of $30,000 to ries, $25,000 to bax, and $37,000 to thomas; granting 10% interest on the partners’ beginning capital investments; and sharing the remainder equally.\ncomplete this question by entering your answers in the tabs below.\nappropriation of profits general journal\nallocate $317,700 net income by providing annual salary allowances of $30,000 to ries, $25,000 to bax, and $37,000 to thomas; granting 10% interest on the partners’ beginning capital investments; and sharing the remainder equally.

Answer

Explanation:

Step1: Calculate total salary allowances

$30000 + 25000+37000=$92000$

Step2: Calculate interest allowances

Ries: $30000\times0.1 = 3000$; Bax: $46000\times0.1=4600$; Thomas: $54000\times0.1 = 5400$. Total interest allowances: $3000 + 4600+5400=$13000$

Step3: Calculate balance after salary and interest allowances

$317700-(92000 + 13000)=$212700$

Step4: Allocate the remaining balance equally

Each partner's share of remaining balance: $212700\div3=$70900$

Step5: Calculate each partner's total income allocation

Ries: $30000+3000 + 70900=$103900$ Bax: $25000+4600+70900=$100500$ Thomas: $37000+5400+70900=$113300$

Item Ries Bax Thomas Total
Net income $317700$
Salary allowances $30000$ $25000$ $37000$ $92000$
Balance after salary allowances $225700$
Interest allowances $3000$ $4600$ $5400$ $13000$
Balance after interest and salaries $212700$
Balance allocated equally $70900$ $70900$ $70900$ $212700$
Entrance of income $103900$ $100500$ $113300$ $317700$

Answer:

Item Ries Bax Thomas Total
Net income $317700$
Salary allowances $30000$ $25000$ $37000$ $92000$
Balance after salary allowances $225700$
Interest allowances $3000$ $4600$ $5400$ $13000$
Balance after interest and salaries $212700$
Balance allocated equally $70900$ $70900$ $70900$ $212700$
Entrance of income $103900$ $100500$ $113300$ $317700$