Welcome to the forum. Could you please introduce yourself and business so that we can get a clearer picture of what is going on. What does your company do? How long have you been in business? What kind of a profit turn around are you looking at so far? Have you approached your accountant and bookkeeper on this topic?
Thanks for email, here is all the answers to your question and My Question
at the end...Let me know your thoughts.
Well the company is in the Retail buisness. My partner had that buisness
earlier from 90s, I worked for him for 5yrs from 2004-2009 with a condition
that he going to sell the buisness to me after 5yrs. After 5 yrs when the
time came he kept his word but due to financial constraints I told him that
lets do partnership and Me (70%) and my partner (30%) entered into
partnership and formed new Comapny in 2009.We been in the buisness from
2009. Every year at the end of year we would distribute the profit in the
same ratio as above. Yearly Sales half a million, and net pofit would be
around 70-90k total.
Well as far as the book keeping and the accountant, I trusted my partner
for keeping that and interaction with Accountant. Now I offered him to buy
all his 30%share. He agreed and we decided to give him the 30% of the total
cost of inventory as per books and 30% of what ever money is left in the
bank accounts after clearing all the outstanding Charges. total comes
around 100K.At the end he says that he wan't to show that money as Goodwill
because of tax.
Hopefully now the picture is clear, if you have any specific question
please email me.
My question is how is it going to affect me today and in the long run.
Thanks & Regards,
On Thu, Sep 5, 2013 at 9:41 AM, Moderator Melinda <
I did replied to the email I got, do I have to reply from this link or that's good.
It sounds like to me that the company is very stable, which is a good thing. My suggestion to you is speaking with the companies accountant about this topic. Once you buy the company 100% you will need to continue with the accountant anyway. Ask the accountant to show you the books and give you advice. I am not sure what your partner means as "goodwill". Is he referring to a "gift"?
I am 70% partner in Buisness, wanted to buy 30% ...The inventory in the buisness is 280,000. Bank Accounts 20,000.
The partner says he is going to sell his 30% If I pay him 100,0000 . But he is going to treat the value 100,000 as Goodwill and sold his 30% share.
My Question is - How it is going to affect me today and in LongRun.