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P1 C5 ADMISSION OF A PARNER — Elements of Account STD 12 Commerce — Question

Gujarat BoardEnglish MediumSTD 12 CommerceElements of AccountP1 C5 ADMISSION OF A PARNER1 Mark
Question
For what purpose a new partner is admitted in a firm?
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Answer

A new partner may be admitted in a continuing firm because of the following reasons :
  • When continuing firm needs additional capital, additional managerial ability.
  • For the distribution of risk of the partnership firm.
  • When any continuing partner retires or dies.
  • When services or skilled and efficient employees of the firm is required.

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