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Memorandum Joint Venture Method

Under this method, no separate set of books is maintained. Instead, each co-venturer maintains
  • Memorandum Joint Venture A/c
  • Joint venture with other co-venturers A/c (personal account of other co-venturers)

Memorandum Joint Venture account is opened to find the profit or loss of the venture. It contains the cost of goods, expenses etc. on the debit side and sales and other incomes such as insurance claim received, goods taken over by the co-venturer etc on the credit side. Entries in a Memorandum Joint Venture account are not made through journal entries. It is prepared through memoranda i.e. transactions are directly entered in the Memorandum Joint Venture account without going through the process of journal.



  • Memorandum Joint Venture account is merely a statement showing profit or loss on venture.
  • Joint venture with other co-venturers account is a personal account of the other co-venturers. It contains the transactions of co-venturers in whose books this account is maintained. In other words, each party will record only such transactions as effected by him on Joint Venture account. For example, in the books of X, ‘Joint venture with Y A/c’ will contain the transactions effected by X only. A transaction effected by the other co- venturer is not recorded.
  • Even in case there are more than two venturers, only one personal account is to be opened in each party’s book. For example if X, Y and Z have entered into a joint venture, X will open only one personal account of Y and Z and not separate accounts.


Journal Entries

Illustration 3


X enters into a joint venture with Y. The following transactions took place during the course of the venture.

Pass the necessary journal entries and prepare necessary accounts in the books of X and Y assuming that every co-venturer records the transactions in his own books of account under the Memorandum method.




Journal of X



Journal of Y

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