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Lecture 13 – Joint Venture Accounting Accountin g 1
2 Accounting Entries – where separate set of books are maintained
Transaction Initial Contribution by Co venturer Exp. Out of Joint Bank Account Direct Exp. By Co-venturer for Joint Venture Sale or Payment received Sale or Payment received by Co-venturer directly Profit on Joint Venture Loss on Joint Venture Closing Joint Bank Account
Accounting Entry Entry Joint Bank A/c Dr. To Co- venturers’ venturers’ A/c Joint Venture A/c Dr. To Joint Bank A/c Joint Venture A/c Dr. To Co- venturers’ venturers’ A/c Joint Bank A/c Dr. To Joint Venture A/c Co- venturers’ venturers’ A/c Dr. To Joint Venture A/c Joint Venture A/c Dr. To Co- venturers’ venturers’ A/c Co- venturers’ venturers’ A/c Dr. To Joint Venture A/c Co- venturers’ venturers’ A/c Dr. To Joint Bank A/c
Accounting Entries – Each Each Co-venturer keeps keeps record of all transactions Transaction For Supply of Goods to Joint Venture out of business For meeting Joint Venture Exp. Other co-venturer supplies goods or meets exp. Joint venture sale made by self Joint venture sale made by other co-venturer For Joint – venture profit
For Joint – venture loss
Settlement of dues
3 Accoun ting Entries – Each Each Co- venturer keeps record of own transactio ns only
Transaction For Supply of Goods to Joint Venture out of business For meeting Joint Venture Exp. Other co-venturer supplies goods or meets exp. Joint venture sale made by self Joint venture sale made by other co-venturer
Accounting Entry Entry Joint Venture A/c Dr. To Purchase A/c Joint Venture A/c Dr. To Bank A/c No Entry - Only entered in Memorandum Memorandum Joint Venture Account Bank A/c Dr. To Joint Venture A/c No Entry - Only entered in Memorandum Memorandum Joint Venture Account
Quick Revision Notes
Transaction For Joint – venture profit For Joint – venture loss Settlement of dues
Accounting Entry Entry Joint Venture A/c Dr. To Purchase A/c Joint Venture A/c Dr. To Bank A/c Joint Venture A/c Dr. To Co-venturer A/c Bank A/c Dr. To Joint Venture A/c Co-venturer Dr. To Joint Venture A/c Joint Venture A/c Dr. To Profit & Loss A/c (own share) To Co-venturer A/c (co- venturers’ venturers’ share) Profit & Loss A/c Dr. (own share) share) Co-venturer A/c Dr. (co- venturers’ venturers’ share) To Joint Venture A/c Co-venturer A/c To Bank A/c
Accounting Entry Entry Joint Venture A/c To Profit & Loss A/c Profit & Loss A/c To Joint Venture A/c Joint Venture A/c To Bank A/c