Question:
Give me at least 3 things/knowledge that you won't forget about Dissolution by
Retirement/Death/ Incorporation.
Answer:
In Dissolution by Retirement/Death/Incorporation,
• I learned that if the retirement date is not at the end of the accounting year or
on December 31, then the first step is to update the capital accounts of partners
through asset revaluation, profit distribution, and closing drawing account to
capital account. If the given problem states that the retirement happened by the
end of the accounting period, then there is no need to update the capital
accounts.
• Second, I learned that unlike in admission, where asset revaluation only affects
the existing partners, asset revaluation in retirement/death/incorporation affects
all partners, including the retiring partner.
• Lastly, I learned that the second step in retirement/death/incorporation is to
record the dissolution and its effect on the total partner’s equity.
Give me at least 3 things/knowledge that you won't forget about Dissolution by
Retirement/Death/ Incorporation.
Answer:
In Dissolution by Retirement/Death/Incorporation,
• I learned that if the retirement date is not at the end of the accounting year or
on December 31, then the first step is to update the capital accounts of partners
through asset revaluation, profit distribution, and closing drawing account to
capital account. If the given problem states that the retirement happened by the
end of the accounting period, then there is no need to update the capital
accounts.
• Second, I learned that unlike in admission, where asset revaluation only affects
the existing partners, asset revaluation in retirement/death/incorporation affects
all partners, including the retiring partner.
• Lastly, I learned that the second step in retirement/death/incorporation is to
record the dissolution and its effect on the total partner’s equity.
