n the ABC partnership the capital balances of Allan, Ben, and Carl, who share income in the ratio of 5:3:2 is 600,000, 400,000, and 300,000, respectively. The partners agreed to admit Dan. Before the admission of Dan, the three current partners agreed that land is to be increased to account for its fair value. In the admission, Dan directly purchases 20% by paying Allan 145,000, Ben 95,000 and Carl 70,000. If there was no gain to any of the three partners for the purchase of interest, by what amount is the land account increased? a) 0 b) 60,000 c) 250,000 d) 510,000
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.
In the ABC
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