Exercise 12- 11 (Algo) Admission of new partner LO P 3 The Struter Partnership has total partners' equity of $ 480,000, which is made up of Main, Capital, $336, 000, and Frist, Capital, $144, 000. The partners share net income and loss in a ratio of 84% to Main and 16 % to Frist. On November 1, Adison is admitted to the partnership and given a 20% interest in equity and a 20% share in any income and loss. Prepare journal entries to record the admission of Adison for a 20% interest in the equity and a 20% share in any income and loss under independent assumption. (1) Record the admission of Adison with an investment of $ 120,000 for a 20 % interest in the equity and a 20 % share in any income and loss. (2) Record the admission of Adison with an investment of $155,000 for a 20% interest in the equity and a 20 % share in any income and loss. (3) Record the admission of Adison with an investment of $90,000 for a 20% interest in the equity and a 20% share in any income and loss.Answer is complete but not entirely correct. \table[[ No, Transaction,Debit,Credit], [A, (1), Cash, 0,120,0007.].[,Adison, Capital,0,, 120,000], [B, (2), Cash,0, 155,0000,],[,Adison, Capital,0,127,000],[, Main, Capital,0,, 22, 120 x
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.
Exercise 12- 11 (Algo) Admission of new partner LO P 3 The Struter
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