Surj Uppal and Parvinder Atwal began a new business on February 14, when each invested $160,500 in the company. On Decem

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Surj Uppal and Parvinder Atwal began a new business on February
14, when each invested $160,500 in the company. On December 20, it
was decided that $62,000 of the company’s cash would be distributed
equally between the owners. Two cheques for $31,000 were prepared
and given to the owners on December 23. On December 31, the company
reported a $124,000 profit.

Required:
Prepare two sets of journal entries to record the investments by
the owners, the distribution of cash to the owners, the closing of
the Income Summary account, and the withdrawals or dividends under
these alternative assumptions:

a. The business is a partnership.
b. The business is a corporation that issued
1,000 common shares. Cash dividend account is used for declaring
dividends.