James invests $19000 in cash (admission by investment) in the Seiler-Shaw partnership to acquire a 1/4 interest. In this case O the total capital of the new partnership is greater than the total capital of the old partnership. O the total net assets of the new partnership are unchanged from the previous partnership. O the accounting will be the same as a purchase of an interest. O James's income ratio will automatically be 1/4.
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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