Rachel, Jenna, and Lauren are partners with capital balances of $$80,000,$ $$10,000,$ and

$$10,000,$ respectively. Partnership profit for the year is $$150,000.$

Required: Prepare the necessary journal entries to close Income Summary to the

capital accounts if:

$($A$)$ The partners agree to divide income based on their beginning$-$of$-$year capital

balances.

$($B$)$ The partners agree to divide income based on the ratio of $5$:$3$:$2,$ respectively.

$($C$)$ The partnership agreement does not specify division of income.

Answer rating: 100% (QA)

A Closing entries based on beginningofyear capital balances 1 Debit Income Summary for the total net ... View the full answer