Chapter No. 5 – Admission of a Partner – Solution – Class 12 of the all practical problems with the animation and videos. First we will clear the meaning of the term of Admission of a Partner shown as following:
Admission of Partner referred to entering a new partner or partners in the partnership firm for the share of profit and paying off his or their share of the firm’s goodwill and capital. When the firm needs more funding or services/knowledge to grow their business then they approach to the new partner(s) against share in the profit of the firm with the consent of all old partners.
What is the Admission of Partner: –
The admission of the partner refers to the situation where an individual joins the existing partnership firm and the old partners are agree to sacrifice their share of profit. This is the mode of reconstitution of Partnership Because, with the admission of a new partner, there is a need to create a new agreement/deed between all partner including new partner and ends the existing agreement/deed.
There will be New profit sharing ration among all partners because the all(minimum one) old partners will sacrifice some portion of their profit share in the firm and the new partner will get some portion of the share of profit as per the deal with the old partners.
Read the Full Article from the following link: –
Admission of Partner – Effects and Adjustments
Chapter No. 5 – Admission of a Partner – Solution – Class 12
Chapter No. 5 – Admission of a Partner – Solution – Class 12
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