Journal Entry for Advertisement Suspense A/c in Admission of a Partner

The admission of a partner in a business involves various accounting transactions and entries. One such entry is the journal entry for Advertisement suspense A/c, which is explained below:

1. Identify the Nature of the Advertisement Expense
- Determine if the advertisement expense is capital or revenue in nature.
- If it is revenue in nature, it will be debited to the Advertisement Expense A/c and credited to the cash or bank account.
- If it is capital in nature, it will be debited to the Advertisement Suspense A/c.

2. Admission of a Partner
- When a new partner is admitted to the business, the existing partners may decide to share the advertisement expense incurred by the business.
- The new partner will have to contribute his share of the expense.
- The entry for the admission of a partner will include the following:
- Debit the Capital Account of the new partner with his contribution.
- Credit the Advertisement Suspense A/c with the expense incurred.
- Credit the Capital Accounts of the existing partners with their share of the expense.

3. Adjustment Entry
- The Advertisement Suspense A/c will have to be cleared after the admission of the new partner.
- The entry for this will include the following:
- Debit the Advertisement Suspense A/c with the balance.
- Credit the Capital Accounts of the partners with their share of the expense.

In summary, the journal entry for Advertisement Suspense A/c in admission of a partner involves debiting the Advertisement Suspense A/c with the expense incurred, crediting the Capital Accounts of the partners with their share of the expense, and clearing the Advertisement Suspense A/c with an adjustment entry.

All partners a/c Dr.

to advertisement suspense A/C