Kim Ries, Tere Bax, and Josh Thomas invested $40,000, $56,000, and $64,000, respectively, in a partnership. During its first calendar year, the firm earned $124,500.

Required
Prepare the entry to close the firm’s Income Summary account as of its December 31 year-end and to allocate the $124,500 net income to the partners under each of the following separate assumptions: The partners
(1) Have no agreement on the method of sharing income and loss;
(2) Agreed to share income and loss in the ratio of their beginning capital investments; and
(3) Agreed to share income and loss by providing annual salary allowances of $33,000 to Ries, $28,000 to Bax, and $40,000 to Thomas; granting 10% interest on the partners’ beginning capital investments; and sharing the remainder equally.