2. On July 1, 2019, Lola wants to retire from JKL Partnership. The Statement of Financial Position of JKL Partnership before closing on that date shows the following: Cash Receivables, net Equipment, net Prepaid expenses Total assets 148,000 72,000 270,000 60,000 550,000 Liabilities Jose, Capital Kiko, Capital Lola, Capital Income summary Total liabilities and equity 90,000 200,000 96,000 84,000 80,000 550,000 Jose, Kiko and Lola share profits and losses in the ratio 5:3:2, respectively. The partners agreed to write-off the prepaid expenses and to adjust the equipment to its fair value of 230,000. Lola is paid 110,000 cash for his total interest. What is the balance of each remaining partner's account after Lola's retirement?
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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