The new partner acquired the rights on admission into the firm. He acquires :
(A) Rights in past profits of firm before admission.
(B) Right to share in the future profits of the firm.
(C) Right to share assets of the firm.
(D) The right to carry on competing business.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (B) and (C) only
On admission, a new partner gets two main rights: the right to share the assets of the firm and the right to share its profits. For these he brings capital (and premium for goodwill where the firm earns super profits).
(A) Rights in past profits of firm before admission. Incorrect. Profits earned before admission (reserves, accumulated profits) belong to the old partners and are shared by them in the old ratio; the new partner has no share in them.
(B) Right to share in the future profits of the firm. Correct. This is one of the two rights he acquires; from the date of admission he shares the profits in the new ratio.
(C) Right to share assets of the firm. Correct. This is the other right; he becomes a co-owner of the firm’s assets.
(D) The right to carry on competing business. Incorrect. A partner who carries on a business competing with the firm must account for and pay to the firm all profits made in it; admission gives no such right.
NCERT (2026-27 edition): |