For the fiscal year ended May 31, 2006, Ace, Bay & Cap Limited Liability Partnership had an operating loss of $120,000 before recognition of partners' salaries expense. The partnership contract provided for the following:
Salaries of $20,000 to Ace, $30,000 to Bay, and $40,000 to Cap, to be recognized as expense by the partnership
Bonus of 20% of income after the bonus to Ace
Residual income or loss 20% to Ace, 50% to Bay, and 30% to Cap
Prepare journal entries (omit explanations) for Ace, Bay & Cap Limited Liability Partnership on May 31, 2006.

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The Answer of For the fiscal year ended May 31, 2006, Ace, Bay & Cap Limited Liability Partnership had an operating loss of $120,000 before recognition of partners' salaries expense. The partnership contract provided for the following:
Salaries of $20,000 to Ace, $30,000 to Bay, and $40,000 to Cap, to be recognized as expense by the partnership
Bonus of 20% of income after the bonus to Ace
Residual income or loss 20% to Ace, 50% to Bay, and 30% to Cap
Prepare journal entries (omit explanations) for Ace, Bay & Cap Limited Liability Partnership on May 31, 2006.

For the Fiscal Year Ended May 31, 2006, Ace, Bay