Question:
A, B and C are partners in a firm. If D is admitted as a new partner, what will be its effect?
A, B and C are partners in a firm. If D is admitted as a new partner, what will be its effect?
Show Hint
Admission of a partner does not dissolve the firm. It only reconstitutes the partnership with a new agreement.
Updated On: Sep 11, 2025
- Old firm is dissolved
- Old firm and old partnership is dissolved
- Old partnership is reconstituted
- Firm will lose its existence
Hide Solution
Verified By Collegedunia
The Correct Option is C
Solution and Explanation
Step 1: Concept of admission of a partner.
When a new partner is admitted, the existing partnership agreement ends and a new agreement is created. However, the firm as a business entity continues to exist.
Step 2: Effect on the firm.
- The old partnership is dissolved legally, but not the firm itself.
- A new partnership is formed, including the new partner.
- This process is called "reconstitution of partnership."
Final Answer: \[ \boxed{\text{The old partnership is reconstituted.}} \]
Was this answer helpful?
0
0
Top Questions on Reconstitution of Partnership
- Arrange the admission procedure in correct sequence: (A) Giving share to the new partner.
(B) Treatment of Goodwill.
(C) Calculating new profit sharing ratio and sacrificing ratio.
(D) Preparation of Revaluation A/c.
(E) Preparing Partner's Capital A/c and Balance Sheet.- CUET (UG) - 2025
- Accountancy
- Reconstitution of Partnership
- A and B are partners sharing profits in the ratio of 2:1. C is admitted into the firm for 1/4 share of profits. C brings in Rs. 20,000 in respect of his capital. The capitals of old partners A and B, after all adjustments relating to goodwill, revaluation of assets and liabilities, etc., are Rs. 45,000 and Rs. 15,000 respectively. It is agreed that partners' capitals should be according to the new profit sharing ratio. Determine the new profit sharing ratio.
- CUET (UG) - 2025
- Accountancy
- Reconstitution of Partnership
- What is meant by reconstitution of partnership firm?
- UP Board XII - 2025
- Accountancy
- Reconstitution of Partnership
- Which of the following events does not result in reconstitution?
- CBSE CLASS XII - 2025
- Accountancy
- Reconstitution of Partnership
- A, B and C were partners in a firm sharing profits and losses in the ratio of \( \frac{1}{2} : \frac{1}{3} : \frac{1}{4} \). D was admitted in the firm for \( \frac{1}{6} \) share. C would retain his original share. The new profit sharing ratio will be:
- CBSE CLASS XII - 2024
- Accountancy
- Reconstitution of Partnership
View More Questions
Questions Asked in CUET exam
- The feasible region is bounded by the inequalities: \[ 3x + y \geq 90, \quad x + 4y \geq 100, \quad 2x + y \leq 180, \quad x, y \geq 0 \] If the objective function is $ Z = px + qy $ and $ Z $ is maximized at points $ (6, 18) $ and $ (0, 30) $, then the relationship between $ p $ and $ q $ is:
- CUET (UG) - 2025
- Linear Programming
- What is the angle between the hour and minute hand at 3:30?
- CUET (UG) - 2025
- Clock and Calendar
- A number is increased by 25% and then decreased by 20%. What is the net % change?
- CUET (UG) - 2025
- Percentage
- A train crosses a platform 200 m long in 36 seconds and a pole in 18 seconds. Find the speed of the train.
- CUET (UG) - 2025
- Speed, Time and Distance
- If \( 3 \times 4 = 25 \), \( 5 \times 2 = 27 \), \( 6 \times 3 = 39 \), then what is \( 7 \times 5 = ? \)
- CUET (UG) - 2025
- Logical Reasoning
View More Questions