Partnership Accounting | Baamboozle - Baamboozle

What does an appropriation account do?

refers to a breakdown of how a firm's profits are divided up i.e how owners of a business split losses and profits

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baam

Lose 10 points!

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magnet

Take 15 points!

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shark

Other team loses 20 points!

Okay!

lifesaver

Give 20 points!

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monster

Reset all scores!

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seesaw

Swap points!

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rocket

Go to first place!

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banana

Go to last place!

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Define a partnership business

A partnership is a business that has 2 to 20 owners who all work together with the main aim of making profits and also who shares these profits/losses

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trap

No points!

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shark

Other team loses 10 points!

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fairy

Take points!

banana

Go to last place!

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What are 2 disadvantages of a partnership?

Partners have unlimited liability in most cases (at least 1 partner) or capital is still limited in most regards or difficult to transfer partnerships

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Salaries and other performance related payments are subtracted in the appropriation account. True or False?

True

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Define goodwill

Goodwill is an intangible asset that accounts for the excess purchase price of another company.

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What does interest on drawings mean?

To deter the partners from taking out cash unnecessarily, the concept can be used of charging the partners interest on each drawing or withdrawal

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What does a debit amount mean on a current account?

This means a partner has taken out more than their share of profits than they were entitled to

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On a partners current account drawings and interest on drawings are found on the debit side of the account. Is this True or False?

True

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Why is fixed capital accounts preferred over fluctuating capital accounts?

Because it is easier to located situations when a partners takes excess amounts of money out of the business

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Salaries will be found on the credit side of the current account. True or False?

True

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lifesaver

Give 25 points!

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fairy

Take points!

rocket

Go to first place!

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banana

Go to last place!

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Net profit before any distributions were $10,000 and a partner had to get a salary of $1500 also he was charged drawing of $2000 how much profits will remain after calculations?

12,000 - 1500 = 10,500

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What is a partnership deed and why may it be helpful to have one created?

Partnership deed is a formal contractual agreement among all partners to agree to terms and conditions of a partnership and it helps to resolve potential issues

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