Correct sequence of activities involved in case of admission of a partner is -

A. Calculation of New and Sacrificing ratios

B. Preparing of Revaluation account

C. Preparation of partners Capital account

D. Adjustments of Capitals

E. Preparation of New Balance Sheet.

Choose the correct answer from the options given below :

A, B, C, D, E

The correct answer is option 2-A, B, C, D, E

The correct sequence of activities involved in the case of admission of a partner follows this order:

A. Calculation of New and Sacrificing ratios: Determine the new profit-sharing ratio among the existing partners and the sacrificing ratio, which indicates how much the existing partners are sacrificing in favor of the new partner.

B. Preparing of Revaluation account: This involves revaluing assets and liabilities to reflect their current fair values. Revaluation gain or loss is credited among the existing partners in their old ratio.

C. Preparation of partner's Capital account: Prepare the capital accounts of the partners, including any adjustments for the admission of the new partner like goodwill etc.

D. Adjustments of Capitals: Adjust the capital accounts of the existing partners if they want after the admission of the new partner. Excess or deficit of capital is adjusted.

E. Preparation of New Balance Sheet: Finally, prepare a new balance sheet reflecting the changes in assets, liabilities, and partner capital resulting from the admission of the new partner.