Capital balances in the WXY partnership are W, Capital P 60,000; X Capital P 50,000 and Y Capital P40,000, Profits and losses are 5:3:2, respectively. The WXYZ partnership is formed by admitting Z to the partnership with a cash investment of P 60,000 for a 25% capital interest The bonus to be credited to Y in admitting Z is
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
