Upon learning differences in methods of admitting a new partner, which between purchase of interest and investment of assets would you prefer if you were: a) The incoming partner b) The existing partner Justify by identifying the advantages and disadvantages of each method from each method from each partner’s point of view
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
Upon learning differences in methods of admitting a new partner, which between purchase of interest and investment of assets would you prefer if you were:
a) The incoming partner
b) The existing partner
Justify by identifying the advantages and disadvantages of each method from each method from each partner’s point of view.
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