Partnership equity is the percentage interest that a partner has in partnership assets. In other words, partnership equity represents the partner's ownership interest in the business. The total contributions of all partners plus retained earnings are reflected on a partnership's balance sheet as equity. It is not uncommon for an equity partner to have unequal equity in the partnership. The two agree that the fair market value of services that Tim brings to the partnership is $75,000 . Tessa funds the partnership with $100,000. Tim will have about a 42 percent equity stake in the partnership and Tessa will have about a 58 percent stake. Profits and losses are distributed between the partners according to the partnership agreement. While allocation of profits and losses do not have to be equal to the percentage of the equity each partner has in the partnership, it is a common method of allocation. Michael has a 75 percent equity interest in the partnership, and Janice has a 25 percent interest. Michael and Janice agree to distribute profits and losses in accordance with their respective partnership interest.
You can read more here: https://smallbusiness.chron.com/partnership-equity-64265.html
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath