Problem 12-02A a-c (Part Level Submission) (Video)

At the end of its first year of operations on December 31, 2020, NBS Companys accounts show the following.

Partner		Drawings		Capital
Art Niensted		$23,000		$48,000
Greg Bolen		14,000		30,000
Krista Sayler		10,000		25,000

The capital balance represents each partners initial capital investment. Therefore, net income or net loss for 2020 has not been closed to the partners capital accounts. To record the division of net income for the year 2020 under each of the following independent assumptions.

1.		Net income is $30,000. Income is shared 6:3:1.
2.		Net income is $40,000. Niensted and Bolen are given salary allowances of $15,000 and $10,000, respectively. The remainder is shared equally.
3.		Net income is $19,000. Each partner is allowed interest of 10% on beginning capital balances. Niensted is given a $15,000 salary allowance. The remainder is shared equally.

Journalize the entry to record the division of net income for the year 2020 under each of the above independent assumptions.

Income Summary A. Niensted, Capital 18,000 G. Bolen, Capital 9,000 K. Sayler, Capital 3,000 Income Summary A. Niensted, Capital 17,500 G. Bolen, Capital 17,500 T K. Sayler, Capital 5,000 3. Income Summary 000 A. Niensted, Capital T 15,000 T G. Bolen, Capital 2,000 K. Sayler, Capital 2,000