Month: January 2022

When a new partner is admitted into the firm, this marks the end of the old partnership and the beginning of a new one. The new partner will have to bring in the capital that is due from him as Read More …

The business may revalue some of the assets to reflect their fair values (e.g.) based on market price. The revaluation is normally done when a new partner is to be admitted or an old partner is retiring. Any revaluation gains Read More …

This is defined as the advantage, whatever it may be, a person gets by continuing to be entitled to represent to the outside would that he is carrying on a business which has been carried on for sometime previously. “Judge Read More …

The balance sheet also the same as that for a sole trader but the interest of each partner in the business should be shown separately and any loan given by a partner to the firm is also shown separately in Read More …

The profit and loss account is exactly as the one for the sole trader and in addition to the profit and loss account, a new section called the appropriation account is included and this account shows how the partners share Read More …

A partnership has minimum membership of two (2) maximum of fifty (50) except for professional firms (e.g.) lawyers, doctors, accountants etc. whose maximum membership is twenty (20) persons. Where two or more persons wish to form a partnership, then it Read More …

A partnership is a relationship that subsists between two or more persons carrying on a business common with a view to making profit. Among others, reasons for partnership may be Additional capital incase a sole trader or one person is Read More …

In most cases where business transfers finished goods at a profit to the selling department and the goods are reflected in the balance sheet at the transfer price, then the closing stock includes a profit that has not been earned Read More …

Administration Expenses these are expenses incurred in providing control, direction and management of the firm Such as expenses relating to secretarial, accounting, rent, rates, insurance, water, electricity etc for the office. Also included in depth of office furniture & equip, Read More …

Some firms may manufacture or produce goods rather than buy due to savings in operational costs. (i.e. it is cheaper to produce the goods rather than buy). Due to additional costs involved in the production process, additional information is reported Read More …