Intermedia, LLC, has three members: WYXT Partners, Lindsey Wilson, and Daily Sun Newspaper, LLC. On January 1, 2010, the three members had equity of $200,000, $50,000, and $120,000, respectively. WYXT Partners contributed an additional $50,000 to Intermedia, LLC, on June 1, 2010. Lindsey Wilson received an annual salary allowance of $115,600 during 2010. The members’ equity accounts are also credited with 12% interest on each member’s January 1 capital balance. Any remaining income is to be shared in the ratio of 4:3:3 among the three members. The net income for Intermedia, LLC, for 2010 was $650,000. The salary and interest allowances were distributed to the members.
(a) Determine the division of income among the three members.
(b) Prepare the journal entry to close the net income and withdrawals to the individual member equity accounts.
(c) Prepare a statement of members’ equity for 2010.