October 30, 2016 admin

Partners’ or Proprietor’s Investment

Liabilities and Net Worth

PARTNERS’ OR PROPRIETOR’S INVESTMENT NET WORTH ACCOUNT
2830

ACCOUNT EXPLANATION
Amount of cash or the fair market values of other assets invested in the business by the partners or the proprietor, including net earnings retained from prior years.
TRANSACTIONS
  Jrnl. Dr. Cr.
  Cash and property invested by proprietor CR
    Cash in Bank—General 1001
    Land (Auto Business Only) 1700
      Partners’ or Proprietor’s Investment 2830
             
  Current year profit closed into this account G
    Net Profit or (Loss) After Income Tax 2850
      Partners’ or Proprietor’s Investment 2830
             
  Current year drawings closed into this account G
    Partners’ or Proprietor’s Investment 2830
      Partners’ or Proprietor’s Drawing 2840
COMMENTS
  • This account should be used only by dealerships operating as partnerships or proprietorships. Separate investment accounts should be maintained for each partner.
  • If assets received as a capital contribution are recorded at fair market value, tax counsel should be obtained to determine proper value and depreciation for income tax purposes.