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    Qa Partnership

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    Faker Mejia
    Adam, Boon, and Chelsey formed a partnership. Adam contributed computers worth Rs. 500,000 and cash of Rs. 300,000. Boon contributed cash of Rs. 700,000 and stock worth Rs. 100,000. Chelsey contributed a plant worth Rs. 280,000 and cash of Rs. 520,000. Journal entries were made to record each partner's capital contribution, crediting their individual capital accounts.

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    Qa Partnership

    Uploaded by

    Faker Mejia
    44 views9 pages
    Adam, Boon, and Chelsey formed a partnership. Adam contributed computers worth Rs. 500,000 and cash of Rs. 300,000. Boon contributed cash of Rs. 700,000 and stock worth Rs. 100,000. Chelsey contributed a plant worth Rs. 280,000 and cash of Rs. 520,000. Journal entries were made to record each partner's capital contribution, crediting their individual capital accounts.

    Original Description:

    Accountancy

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    Adam, Boon, and Chelsey formed a partnership. Adam contributed computers worth Rs. 500,000 and cash of Rs. 300,000. Boon contributed cash of Rs. 700,000 and stock worth Rs. 100,000. Chelsey contributed a plant worth Rs. 280,000 and cash of Rs. 520,000. Journal entries were made to record each partner's capital contribution, crediting their individual capital accounts.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    44 views9 pages

    Qa Partnership

    Uploaded by

    Faker Mejia
    Adam, Boon, and Chelsey formed a partnership. Adam contributed computers worth Rs. 500,000 and cash of Rs. 300,000. Boon contributed cash of Rs. 700,000 and stock worth Rs. 100,000. Chelsey contributed a plant worth Rs. 280,000 and cash of Rs. 520,000. Journal entries were made to record each partner's capital contribution, crediting their individual capital accounts.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 9

    PARTNERSHIP ACCOUNTING EXAMPLES:

    Adam, Boon and Chelsey decided to form the partnership firm. They contributed as follows:

    Adam – computers P500,000 and cash P300,000

    Boon – cash P700,000 and stock P100,000

    Chelsay – plant P280,000 and cash P520,000

    Required:
    a. Calculate the initial capital of each partner.
    b. Prepare a journal entries for the above transaction in the books of partnership firm,
    Solution
    Initial Capital Calculation

    Adam – Cash 300,000 +


    computers 500,000 =
    $800,000

    Boon – Cash 700,000 + stock


    100,000 = $800,000

    Chelsey – Cash 520,000 +


    plant 280,000 = $800,000

    Description Debit Credit


    Cash 300,000   
    Computers 500,000   
          Adam’s capital   800,000 
         
    Cash  700,000  
    Stock 100,000   
         Boon’s capital   800,000 
         
    Cash  520,000  
    Plant   280,000   
          Chelsey’s capital    800,00
    On Jan 1, 2017 Raju, Sanjay and Tendulkar formed a shoe manufacturing partnership.
    Each of the partners have strong reputation in the shoe industry and as a result, their venture could bring about significant be
    They agreed to share profit & loss in the ratio of 1:2:3 respectively. The said ratio is based on the basis of capital contribution

    Raju, who is the oldest among all partners contributed with a cash money of P60,000 and machinery costing P120,000.

    Sanjay who has vast experience in supply chain management contributed with furniture of P100,000 and with cash

    On the other hand, Tendulkar just contributed with cash balance

    Required

    a. record entries in the general journal of the partnership.


    ould bring about significant benefits for every partner.
    e basis of capital contribution of each partner.

    inery costing P120,000.

    ,000 and with cash


    Raju’s capital (60,000 +
    120,000)          =               
     180,000
    As Raju’s shae of capital is 
    1/6th, so we can calculate
    total capital of the firm as
    follows:

    Total capital of the partnership


    firm (6×180,000)     1, 080,000

    Now, we can easily calculate


    Sanjay and Tendulkar’s capital
    a s follows:
    Sanjay’s capital (10,80,000 x
    2/6)                            360,000 
          

    Tendulkar’s capital (10,80,000


    x 3/6)                        540,000
    Aiman and Fazila fomed a retial outlet for grocery named “Savers” with a capital investment of 1,000,000 of which Aiman has
    Aiman contributed with furniture which costs P400,000 at an agreed value of 325,000. On the other hand, Fazila contributed

    Required

    i. prepare journal entries to record the capital investment of Aiman and Fazila.

    ii. prepare the balance sheet of the newly formed partnership.


    1,000,000 of which Aiman has 40 % share while Fazila has 60 % shares.
    ther hand, Fazila contributed in the partnership with equipment costing 350,000 but at an agreed value of 450,000. Apart from this, each
    50,000. Apart from this, each partner invested necessary cash to meet the capital requirement.
      Particular Debit Credit
      

    Cash 75,000
    Furniture 325,000
    Aiman capital 400,000
      (To record the investment of Aiman)

    Cash 150,000
    Equipment 450,000
    Fazila capital 600,000
    (To record the investment of Fazila)

    SAVERS PARTNERSHIP
    BALANCE SHEET

    ASSETS
    CASH 225,000
    FURNITURE 325,000
    EQUIPMENT 450,000
    TOTAL ASSETS 1, 000,000

    EQUITIES
    Aiman's Capital P400, 000
    Fazila's Capital 600,000
    TOTAL EQUITIES 1,000,000

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