can you please guide how to setup a new partner in ruing business. actually i been tried through this #stephttps://forum.manager.io/t/partnership-capital-accounts/567 but unluckily not able to create.
thanks in advance
Are you an existing partnership or a sole trader adding a partner ?
Is the existing partnership being wound up first before being re-created with the new partner ?
With partnerships you activate the Capital Accounts tab under Customise.
Then click on the Capital Accounts tab and add each partners name.
Under Settings - Capital Subaccounts you can maintain capital contributed, Drawings and allocation of share of profits.
#Brucanna its a sole proprietorship, can you please guide me further. because i dont know under which tap have to create partner account
A sole proprietorship cannot have a partner. By definition, a sole proprietorship has a single owner. If you are changing to partnership form of ownership, you are creating a new legal entity and must start fresh accounting records.
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As mentioned above, a sole proprietorship and a partnership are two different business entities so it would be incorrect to just add a partner to a sole proprietor business. Therefore at the partnership start date you need to create (add) a new business. (You should also open a separate bank account in the partnership name)
Within the new business, to record the partnerships equity, under Customise (below Settings) tick Capital Accounts and then scroll to the bottom and click Update.
Click on the Capital Accounts tab and add each partners name.
Under Settings - Capital Subaccounts you can see the default subaccounts
To transfer any assets or liabilities over from the sole proprietorship to the partnership would be done on a case by case basis. EG, if the sole proprietorship has unpaid Accounts Receivables or Payables - will these remain the responsibility of the sole proprietorship or be transferred to the partnership. Any transfers would form part of your equity contribution.
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