One, Two and Three are partners sharing profits and losses in the ratio of 2:3:5 respectively. The partnership is balance sheet at August 30, 2016 follows: One 40,000 Two 60,000 Three 100,000 A. Assuming that Ako is admitted to purchase interest and paid 40,000 for a 40%
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.
One, Two and Three are partners sharing
One 40,000
Two 60,000
Three 100,000
A.
Assuming that Ako is admitted to purchase interest and paid 40,000 for a 40% interest.
1.How much is the total capital after Ako's Admission?
2.What will be the new share of Three after Ako's Admission?
3.What us the Adjusted capital of Two after Ako's admission?
B. Assuming that Ako is admitted by purchase of interest from Three and paid 60,000 for a 30% interest. 1. What will be the new share of Three after Ako's Admission? 2. What amount will be credited to Ako upon his admission? 3. What is the adjusted capital of Thee after Ako's admission
C. Assuming that Ako is admitted by investing 40,000 for a 40% interest. No revaluation of assets is to be recognized. 1. How much is the total capital after Ako's Admission? 2. What is the adjusted capital of Three after Ako's admission? 3. What amount will be debited to the capital of Two after Ako's admission? 4. What amount will be credited to Ako upon his admission?
D. Assuming that Ako is admitted is admitted by investing 80,000 for a 25% interest.
1.How much is the total capital after Ako's admission?
2. what is the new share of Two after Ako's admission?
3.What is the adjusted capital of One after Ako's admission?
4. what amount will be credited to the capital of Three after Ako's admission?
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