The Felix and Morris Partnership has capital account balances as follows: Felix, Capital $145,000 Morris, Capital 160,000 The partners share profit and losses in the ratio of 60% to Felix and 40% to Morris. Instructions Prepare the journal entry on the books of the partnership to record the admission of Singh as a new partner under the following three independent circumstances: a) Singh pays $80,000 to Felix and $95,000 to Morris for one-half of each of their ownership interests in a personal transaction. b) Singh invests $150,000 in the partnership for a one-third interest in partnership capital. c) Singh invests $1,000,000 in the partnership for a one-third interest in partnership capital.
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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