CUET Preparation Today
A newly admitted partner has the right to - |
Share the profit of firm after his admission Share the assets of the firm before his admission Share the general reserve already appearing in the Balance Sheet before his admission Demand extra-profit than his agreed share if business makes huge profits |
Share the profit of firm after his admission |
The correct answer is Option (1) - Share the profit of firm after his admission. A newly admitted partner has the right to Share the profit of firm after his admission. A newly admitted partner acquires two main rights in the firm– For the right to acquire share in the assets and profits of the partnership firm, the partner brings an agreed amount of capital either in cash or in kind. Moreover, in the case of an established firm which may be earning more profits than the normal rate of return on its capital the new partner is required to contribute some additional amount known as premium or goodwill. |
