The Admission of a Partner by Investment.

Abstract It has been the author's observation that first-year accounting students have considerable difficulty in learning how to make calculations for the admission of a partner by investment. The calculations for goodwill or for bonus, and the journalizing of the results seem to contain somewhat more than ordinary difficulty. The method presented in the article is simple, yet it is reasonably complete. It sets forth the five possible cases in concrete form, permitting the student to realize that the whole procedure is actually easy. The process contains certain logical steps that aid the student in tasking and retaining it. In order to simplify the process for the sake of teaching it, the thought and expression "ignoring goodwill" is substituted for the ordinary conception and terra "bonus." It seems easier to build upon the idea of either recording or ignoring goodwill than to include the additional notion of bonus. After the subject has been discussed, the fact that the ignoring of good will means giving a bonus in ownership to someone can be made clear in one statement to the class.