Preparation of balance sheet of partners
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Transcript of Preparation of balance sheet of partners
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Preparation of balance sheet of partnerships
Section 8Objective 9
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Prepare balance sheet of partnerships
• The balance sheet of a partnership similar to that of a sole trading company except for the following:– Capital accounts for each partner is listed
separately– Current accounts of the partners are listed
separately in special sections for example• Current accounts with credit balances are listed as
current liabilities• Current accounts with debit balance are listed as
current assets
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Prepare balance sheet of partnerships
• There are two ways of setting out the capital section showing:– Detailed capital section – shows the capital
account balances at the year end and all of the detailed information are recorded in each partner’s current account
– Summarised capital section –will show the final balances on each partner’s capital and current account
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Format of a detailed capital section
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Sample of a summarised capital section for a partnership company