Loading....
Coupon Accepted Successfully!

 

Method II - Recording in the books of one/all co-venturers


 

Under the method, all the joint venture transactions are recorded by one of the Co-Venturers in his own book of accounts. In the books of Co-Venturersauthorised to record joint venture transactions, generally, the following accounts are opened under this method:

 

(a)   Joint Venture Account to ascertain profit/loss on Joint Venture.

 

(b)      Personal Accounts of other Co-Venturers to record the Joint Venture transactions effected by other Co-Ventures and to ascertain the amount due to/from other Co-Venturer (s).

Journal Entries FOR Recording in the books of one/all co-venturers



1. (a) On Received of any amount or Bills
 

Cash/Bank A/c/ Bills Receivable A/c

Dr.

 

To Co-Venturer's Personal A/c

 


 (b) On Discounting Bills Receivable

 

Bank A/c

Dr.

[Net Proceeds]

Joint Venture A/c

Dr.

[Discount]

 

To Bills Receivable A/c

[Total]

 

 

 



2. On Purchase of Goods for Joint Venture

 

(a) By the Co-venturer recording transactions

 

Joint Venture A/c

Dr.

(with Total)

 

To Cash/Bank A/c

(with cash purchases)

 

To Supplier's A/c      

(with Credit purchases)

 

 

  (b) By the Co-Venturer other than recording the transactions

 

Joint Venture A/c

Dr.

 

To Co-Venturer's Personal A/c

       


 

 

 


3. On Making Payment to Supplier

 

Supplier's A/c

Dr.

(with Total)

 

To Cash/Bank A/c

(with Payment made)

 

To Joint Venture A/c

(with Discount Recd)

 

 

 
 


4. On Supply of Goods out of Own Stock by any of the Co-Venturers

 

(a) By the Co-Venturer recording the transactions

 

Joint Venture A/c

Dr.

 

 

To Purchases A/c/Goods sent on Joint Venture A/c

(if supplies at Cost)

 

To Sales A/c

(if supplies at Point)

                                                   

(b)   By the Co-Venturer other than recording the transactions

 

Joint Venture A/c

Dr.

 

To Co-Venturer's Personal A/c

               

 


 

5. On Payment of Expenses:

 

(a) By the Co-venturer recording transactions

 

Joint Venture A/c

Dr.

(with Total)

 

To Cash/Bank A/c

(with cash purchases)

 

 To Supplier's A/c

(with Credit purchases)

                                                                               

(b) By the Co-Venturer other than recording the transactions

 

Joint Venture A/c

Dr.

 

To Co-Venturer's Personal A/c

               

 



6. On Sale of Goods

 

(a) By the Co-Venturer recording the transactions

 

Cash/Bank A/c 

Dr.

(with Cash sales)

Customer's A/c

Dr.

(with Credit sales)

 

To Joint Venture A/c

(with Total)

 

(b)   By the Co-venturer other than recording the transactions

 

Co-Venturer's Personal A/c

Dr.

 

To Joint Venture A/c

               
 

 


 

7. On receiving Payment from a Customer

 

Cash/Bank A/c

Dr.

(with Payment received)

Joint Venture A/c

Dr.

(with Discount allowed/Bad debts)

 

To Customer's A/c

 

 

               

 


 

8. On Taking away of Unsold Goods by the Co-Venturers
 

(a) By the Co-Venturer recording transactions

 

Goods Sent on Joint Venture A/c

Dr.  

 

To Joint Venture A/c

 

               

(b) By the Co-Venturer other than recording the transaction

 

Co-Venturer's Personal A/c

Dr.

 

To Joint Venture A/c

       


 

 



 

9. When Co-Venturer recording the transaction is entitled to some Commission/Salary.

 

Joint Venture A/c

Dr.

 

To Commission/Salary A/c

 

 

 

 

 

10. On Transfer of the Balance of Joint Venture Account
 

(a)   In case of Profit
 

Joint Venture A/c

Dr.

(with total)

 

To Profit and Loss A/c

(with his own share of profit)

 

To Personal Accounts of Co-Venturers

(with other's share of profit)

 

               

(b)   In case of Loss

 

Profit and Loss A/c

Dr.

(with his own share of loss)

Personal Accounts of Co-Venturers

Dr.

(with other's share of loss)

 

To Joint Venture A/c

(with Total)



 

 

 


11. On Settlement of the balance of Personal A/cs of Co-Venturers

 

(a)   In case of a Debit balance

 

Cash/Bank A/c 

 

Dr.

 

 

To Co-Venturer's Personal A/c

               

(b) In case of a Credit balance

 

Co-Venturer's Personal A/c

Dr.

 

To Cash/Bank A/c

 





Test Your Skills Now!
Take a Quiz now
Reviewer Name