13. In the AD partnership, Allen's capital is P140,000 and Daniel's is P40,000 and they share income in a 3:1 ratio, respectively. They decide to admit David to the partnership. Allen and Daniel agree that some of the inventory is obsolete. The inventory account is decreased before David is admitted. David invests P40,000 for one-fifth interest in the total capital of P220,000. The journal to record David's admission into the partnership will include: *
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
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