Problem #4 Admission by Investment of Assets Dapun, Boyo, and Dino have equities in a partnership of P600,000, P900,000, and P500,000, respectively, and share profits and losses in a ratio of 2:1:2, respectively. The partners have agreed to admit Amolo to the partnership. Required: Prepare the journal entries to record the admission of Amolo to the partnership under each of the following assumptions: 1. Amolo invested P500,000 for a 30% interest, and bonus is recorded for Amolo. 2. Amolo invested P750,000 for a one-fifth interest, and bonus is recorded for the old partners
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.
Step by step
Solved in 2 steps
