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(BQ) Part 2 book "Advanced accounting (Vol. 2 1)" has contents: Introduction to partnership accounts, dissolution of partnership firms, amalgamation, conversion and sale of partnership firms, accounting in computerised environment. | CHAPTER 11 ADVANCED ISSUES IN PARTNERSHIP ACCOUNTS UNIT - 1 : INTRODUCTION TO PARTNERSHIP ACCOUNTS Learning Objectives After studying this unit, you will be able to: ♦ Understand the features of a partnership firm and the need for a Partnership Deed. Understand the points to be covered in a Partnership Deed regarding accounts. ♦ Learn the technique of maintaining Profit and Loss Appropriation Account. ♦ Familiaralize with the two methods of maintaining Partners' Capital Accounts, namely Fixed Capital Method and Fluctuating Capital Method. ♦ Learn that interest on capital and drawings, salaries/commissions are to be shown in the Profit and Loss Appropriation Account and not in the Profit and Loss Account. Also learn that Drawings by partners will not appear in the Appropriation Account. ♦ Learn the accounting of goodwill and see when valuation of goodwill becomes essential in partnership accounts. ♦ Understand the reasons for which revaluation of assets and recomputation of liabilities is required in case of admission of a new partner. Also understand the logic of revaluation of assets and recomputation of liabilities at the time of admission, retirement of a partner and death of a partner. ♦ Learn the technique of treating reserve balance on admission, retirement or death of a partner . ♦ See the technique of arriving at new profit-sharing ratio after admission, retirement or death of a partner . ♦ Learn the technique of keeping records if the balance due to the retiring partner is transferred to loan account. ♦ Understand the accounting implications if death of a partner takes place at any date during the accounting period. ♦ Learn to record the above mentioned transaction and how to record payment of profit to the Executor of the deceased partner for part of the accounting year. Advanced Accounting 1.1 DEFINITION AND FEATURES OF PARTNERSHIP ACCOUNTS The Indian Partnership Act defines partnership as the relationship between persons who have agreed to share
