On February 14, AA and BB formed a partnership and contributed the following assets at historical costs: AA BB Cash P600,000 P200,000 Inventories ? ? Furniture and fixtures 40,000 Delivery equipment 80,000 Land 300,000
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.
On February 14, AA and BB formed a
|
|
AA |
BB |
|
Cash |
P600,000 |
P200,000 |
|
Inventories |
? |
? |
|
Furniture and fixtures |
40,000 |
|
|
Delivery equipment |
|
80,000 |
|
Land |
|
300,000 |
The land was subject to a mortgage which has an unpaid balance of P50,000. The mortgage will be assumed by the partnership. AA and BB agreed to share
How much is the capital account of AA upon formation of the partnership?
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