Moss and Barber organize a partnership on January 1. Moss's initial net investment is $80,000, consisting of cash ($24,000), equipment ($67,000), and a note payable reflecting a bank loan for the new business ($11,000). Barber's initial investment is cash of $43,000. Prepare journal entries to record (1) Moss’s investment and (2) Barber’s investment.
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.
Moss and Barber organize a
Prepare journal entries to record (1) Moss’s investment and (2) Barber’s investment.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
