July 2018

Cambrige Notes: Principles of Accounting: Introduction to Accounting for Partnerships

By |2018-07-25T09:57:29+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Introduction to Accounting for Partnerships

  • It is quite common for two or more people to enter into a business partnership with one another
  • We have already looked at types of business entities here
  • You can also read more about Partnerships in a post found here
  • While most of the […]

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Cambrige Notes: Principles of Accounting: Appropriation Account Example

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Appropriation Account Example

Example Question Appropriation Account

Gandanga, Waeni and Banda are partners. They share profits and losses in the respctive ratios

\tfrac{3}{8} : \tfrac{3}{8}: \tfrac{1}{4}
For the year ended […]


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Cambrige Notes: Principles of Accounting: Partnership Dissolution Solution to Example Question

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Partnership Dissolution Example

  • We looked at the basics of partnership dissolution here
  • We also posted an example question here
  • Now we will present the solution to that question

The realisation account

  • Debtors and Receivables are just one and the same thing
  • Creditors can also be referred […]

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Cambrige Notes: Principles of Accounting: Partnership Financial Statements Example

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Partnership Financial Statements Example

  • As already said elsewhere partnerships also prepare Financial Statements at the end of every period
  • These do not differ much from say those of a Sole Trader
  • Financial Statements of a Partnership include:
  • An Income Statement for the period ended
  • An Appropriation account […]

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Cambrige Notes: Principles of Accounting: Income Statement and Appropriation Account Example

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Partnership Financial Statements Example

  • This is the first part solution to the question that was posted here
  • It examines the basic structure of Financial Statements of partnerships
  • In this part we will look at the Income Statement and Appropriation Account for Save and Moyo

Solution

Save and Moyo

Income Statement […]

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Cambrige Notes: Principles of Accounting: Statement of Financial Position Example

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Partnership Financial Statements Example

  • This is the second part solution to the question that was posted here
  • The first part of the solution to this question can be found here
  • It examines the basic structure of Financial Statements of partnerships
  • In this part we will examine […]

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Cambrige Notes: Principle of Accounting: The concept of goodwill

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: The concept of goodwill

  • It is not unusual for a business to be bought or sold as a going concern i.e.
  • The entire business (or business unit) and its related assets and liabilities
  • Often when a business is sold or bought it is at a price that is […]

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Cambrige Notes: Principles of Accounting: Goodwill and Partnership businesses

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Goodwill and Partnership businesses

  • Now that we have explained the idea of goodwill
  • It is time we examine the concept of goodwill in relation with partnerships
  • As already explained accounting standards require that goodwill be recorded only when a business is bought or sold
  • Partnership business are […]

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Cambrige Notes: Principles of Accounting: Partnership Entries for Goodwill: Changes in Profit Sharing Ratios

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Partnership Entries for Goodwill: Changes in Profit Sharing Ratios

  • The idea of goodwill has been explored in full here
  • We have also looked at the unique treatment of goodwill in partnership businesses here
  • Below we will look at what happens when there is a change in the profit sharing ratio […]

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Cambrige Notes: Principles of Accounting: Goodwill: Changes in Profit Sharing Ratio Example

By |2018-07-25T09:57:28+02:00July 25th, 2018|Cambridge O Level/ IGSCE Accounts Notes, Notes, Ordinary Level Notes|

Cambridge IGCSE Accounting(0452)/O Level Principles of Accounts(7110) Notes: Accounting for Partnerships: Goodwill and Partnership businesses: Changes in Profit Sharing Ratio Example

  • This is an example of a question where there are changes in the profit sharing ratio of a partnership
  • We have already looked at the entries involved in such cases here

Example question

Mhaka, Banda, Feruka and Tangwena run […]


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