The dissolution of a partnership is the process during which the affairs of the partnership are wound up. This should not be confused with the term dissolution when applied to a limited company, which is the event that marks the conclusion of the winding-up.
Required:
Explain THREE (3) differences between dissolution of a partnership and dissolution of a limited liability company.                                                                                                                                                                                                               (3 marks)

Alex, Dennis and Francis have been in partnership business for a number of years, sharing profits in the ratio 6:5:3 respectively. The statement of financial position of the partnership as at 31 March, 2018, showed the following positon:

Additional Information:
On 31 March, 2018, Alex retired from the partnership and the remaining Partners agreed to admit George as a partner on the following terms:

• Goodwill in the old partnership was to be revalued to two years purchase of the average profits over the last three years. The profits of the last three years have been GH¢24,800, GH¢27,200 and GH¢28,010. Goodwill was to be written off in the new partnership.
• Alex was to take his car out of the partnership assets at an agreed value of GH¢2,000. The car had been included in the accounts as of 31 March, 2018, at a written down value of GH¢1,188.
• The new partnership of made up of Dennis, Francis and George were to share profits in the ratio 5:3:2 respectively. The initial capital was to be GH¢50,000 subscribed in the profit sharing ratio.
• Dennis, Francis and George were each to pay to Alex the sum of GH¢10,000 out of their personal resources in part repayment of his share of the partnership.
• Alex was to lend to George any amount required to make up his capital in the firm from the monies due to him (Alex) and any further balance due to Alex was to be left in the new partnership as a loan, bearing interest at 20% per annum. Any adjustments required to the capital account of Dennis and Francis were to be paid into or withdrawn from the partnership
  bank account.

Required:
i) Prepare the partners’ capital accounts, in columnar form, reflecting the adjustments required on the change in partnership. (5 marks)

ii) Prepare the statement of financial position on completion.                                                                                          (5 marks)

iii) For registration of partnership to be effected, there shall be sent to the Registrar General’s Department a copy of the partnership agreement and a statement on a prescribed form signed by all the partners. Outline the main contents of the statement on the prescribed form.                                                                                                                                        (2 marks)

iv) In accordance with the Incorporated Private Partnership Act 1962 (Act 152), state THREE (3) grounds upon which the Registrar General’s Department may not register a partnership business.                                                                          (3 marks)

Ashaiman and Nima are in partnership sharing profits and losses 2:1. They had originally invested GH¢50,000 and GH¢40,000, respectively. Their current account balances on 1 November 2016 were GH¢14,000 credit for Ashaiman and GH¢9,900 debit for Nima.
The partnership agreement specifies the following:

• The payment of interest on drawings and receipt of interest on capital at the rate of 5% per annum and 3% per annum, respectively.
• The partners take drawings in the same proportion as they share profits or losses. Ashaiman takes drawings of GH¢2,400 a month with Nima taking the amount of drawings as allowed by the partnership rules.
• Nima is entitled to take a salary of GH¢2,000 a month.
• The interest on drawings is calculated as if the drawings for the six month period had been taken in full on the first day of the period.

On 1 May 2017, Ashaiman decides to retire. Both partners agree to have the partnership valued and bring in the resultant goodwill into the partnership. Ashaiman agrees to leave GH¢30,000 of his capital as a loan to the business earning interest at the rate of 4% per annum and to withdraw the balance of what is owing to him. An independent expert values the goodwill on 1 May 2017 at GH¢90,000.
On 1 May 2017, Nima decides to enter into a new partnership with Asawasi where they share profits or losses 3:1. They decided to keep the same interest rates from the previous partnership agreement in relation to drawings and capital. Nima’s salary was changed to GH¢2,200 a month from this period to the year-end, Nima took drawings of GH¢10,000 and Asawasi took drawings of GH¢5,000. Asawasi introduced capital of GH¢25,000 on his admission to the partnership. The goodwill was cancelled in the same proportion as they share profits or losses.
The profits for the year amounted to GH¢108,000 and these profits accrued evenly throughout the year.
Required:
For the year ended 31 October 2017:
i) Prepare the Profit & loss Appropriation Accounts.                                                                                                        (9 marks)

ii) Prepare the Current Account of all the individual partners.                                                                                          (6 marks)

a) Santasi and Patasi are in partnership sharing profits and losses in the ratio 3:2. They decided to amalgamate their firm with that of another partnership Bremang and Asafo as at 30 June 2015. Bremang and Asafo share profits and losses in the ratio 2:1.

The following were their statement of financial position as at that date:

Additional information:
The terms of the amalgamation which was concluded by 30 June 2015 were as follows:
i) Profits and losses were to be shared in the ratio of Santasi: Patasi: Bremang: Asafo = 2:2:1:1 respectively.
ii) The values of goodwill of the two firms were agreed to be valued at two year’s purchase of the average profits of the last four accounting years to the year of amalgamation. No goodwill account is to be maintained in the books.
Profits of the firms for the past five years ending 30 June are as follows:

iii) The new firm was to take over all the assets and liabilities of Santasi and Patasi. The following assets of Santasi and Patasi were revalued: buildings GH¢14,400,000; plant and equipment GH¢10,400,000; inventory GH¢8,500,000; trade receivables GH¢5,000,000.
iv) The new firm was to take over all the assets and liabilities of Bremang and Asafo at the following agreed values: plant and equipment GH¢9,500,000; inventory GH¢9,900,000; trade receivables GH¢4,900,000.
v) The capital of the new firm was to be GH¢60,000,000, contributed according to their profit and loss sharing ratio. The balance due to or from the partners will be settled through the bank account of the new firm.
Required:                                                                                                          (15 marks)
i) Prepare Realisation account in the books of each of the old firms as at 30 June 2015.

ii) Prepare the partners’ capital accounts in a columnar form, for the period to 1 July 2015.