Van Camp Accounting is one of two methods used by California community property law to handle community and/or labor funds used to increase the value of separate properties. This method was named after the divorce case of 1921, Van Camp v. Van Camp .
To calculate, the court will assess the services of managers at the market level and reduce the public costs of that amount. The results are considered to belong to the community. The effect of this is that the net income earned by the owner of the property results is separate in the manner in which income is treated under California law, which is a community property. This method is preferred when business character is the reason for its income. In cases where management is the main cause for growth and production, Pereira accounting should be used.
Van Camp is used when business appreciation is due to the nature of the economy or the type of business. In this case, community property is given what the couple may have been paid as an employee for a similar job. The rest is a worker's separate property.
If capital (not a spouse or community labor) is a major factor contributing to a large profit in the value of the business and if labor by a spouse who does not hold the right to the business is given fair compensation during marriage, the Van Camp method will allocate most of the value appreciation to the title holder as a separate property.
Van Camp Accounting can be applied when there is an increase in value due to the unique nature of SP assets (Separate Assets), such as market timing, a world-class management team, or a large number of contributing employees. In this case; A fair wage for community workers x wedding year - salary has been received - amount already paid to community expenditure = CP (Community property), the rest is.SP
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Choose the correct sharing or accounting method
Van Camp Counting is usually selected when Business itself or economic factors generate profits (usually larger and generally more capital-intensive businesses).
Pereira Accounting is usually selected when the business has a lot of manpower (typically smaller and/or labor-intensive businesses).
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References
Source of the article : Wikipedia
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