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    larmat's Avatar
    larmat Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Apr 27, 2010, 11:03 AM
    Change in CDN partnership. How to handle.
    Partner 1 owns 20% of a canadian partnership. Partner 2 owns 80% and has invested $10,000. Partner 1 has invested no capital but has drawn $10,000 resulting in negative capital at the time of dissolving the partnership. A new partner 3 joins Partner 2 and has invested $3,000 and is a 50 % partner. Can the negative capital be written off into the income statement at change of ownership? Would it be wages, loss on dissolution or Goodwill?
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
    Uber Member
    		  
    #2

    Apr 29, 2010, 01:03 AM

    Why is a partner drawing against income that apparently doesn't exist? Or did the income not get applied to the capital account to begin with?
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