Partnership Accounting – Reconstitution

///Partnership Accounting - Reconstitution
11 02, 2016

Capital Accounts of Partners on Retirement

Partners' Capital accounts can be fixed or fluctuating depending on the question.
11 02, 2016

Balance Sheet After Retirement of Partner

All the Accumulated profits/losses should be shared in old profit sharing ratio or as instructed in the question, so, should not be taken to the new balance sheet, if already distributed.
11 02, 2016

Adjustments on Admission of Partner

When a new partner joins a partnership firm, he is said to be admitted into partnership. Adjustments required at the time of admission of the new partner include change in profit sharing ratio, treatment of goodwill etc.
11 02, 2016

Treatment of Goodwill on Admission

Treatment of goodwill is done in various ways and depends on the terms given in the question. It can be paid privately, partly,withdrawn later or any other case.
10 02, 2016

Hidden Goodwill on Admission of Partner

Sometimes goodwill is not given in the question but is inferred from the information given.
10 02, 2016

Accumulated Profits and Losses on Admission of Partner

If at the time of admission of the new partner any Accumulated Profits or losses appear in the Balance Sheet, these will be distributed among the old partners in the old ratio by passing journal entry.
10 02, 2016

Adjustment of Capitals on Admission

For the adjustment of capitals there can be two cases, When the new partner’s capital is not given and when new partner's capital is given.
10 02, 2016

Capital Accounts of Partners on Admission

Capital accounts of the partners can be one in case of fluctuating capitals or two i.e. capital accounts and current accounts in case of fixed capitals.
10 02, 2016

Balance Sheet after Admission of Partner

While preparing Balance Sheet of partnership firm after admission of a new partner all the items must be checked carefully.
10 02, 2016

Treatment of Accumulated Profits and Losses

If the partners decide not to share these profits or they don’t want to disturb the existing profits or simply said, they want to pass an adjusting entry regarding these profits..........
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