Shared Business Project with Customer

I made a project agreement with one of my customer.

:black_large_square: Part One

I will provide him an Analyzer Machine for Running Pathological Test

Cost ৳ 1,00,000

MRP ৳ 2,00,000

He will own and pay only half of the MRP ৳ 1,00,000

And I will own half of the Machine.

So, I made this journal entry-

Debit > Project A (Asset) > ৳ 50,000 [Half of the cost, should it be half of the MRP?]

Credit > Machine (Inventory) > ৳ 50,000 [Half of the cost, should it be half of the MRP?]

Now, I need to make an invoice of ৳ 1,00,000 for him to show sales of the half ownership.

Is it right to entry Qty. 0.5 into above entry?

And Qty. 0.5 into sales invoice?

:black_large_square: Part Two

He will generate money by running test and give it to me whole.

I will sell him materials for test which will be adjusted as following-

Test revenue generated by him: ৳ 50,000
I sold materials to him: - ৳ 10,000
Remaining Revenue: ৳ 40,000

Now, we will split 50/50 of this amount.

I can’t think the right way to make the right entries to keep things easy.

So, I need your kind help.

These are the procedures I would recommend:

  1. Enter into a 50/50 partnership agreement.
  2. Set up a new Manager business for the partnership.
  3. Sell your machine to the partnership for the full price.
  4. Your partner contributes cash for 50% of the cost of the machine into the partnership.
  5. You withdraw the 50% contribution from your partner as a 50% payment of your sales invoice.
  6. Offset the remaining 50% owed to you by the partnership by way of a journal entry debiting accounts payable and crediting your capital account.
  7. Issue a sales invoice to the partnership for the materials supplied by you.
  8. Pay your invoice for the materials from the partnership revenue.
  9. Distribute the net profit equally to the partners.
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