Question

Explain with reasons the accounting treatment of reserves and accumulated profit and loss
appearing in the books of the firm at the time of the admission of a new partner​

Answer 1

Answer:

Adjustments of Reserves, Accumulated Profits, and Losses

Any reserves or accumulated profits/losses appearing on the balance sheet should be transferred to the partner's capital accounts. If the partners decide to leave them undisturbed it is necessary to make an adjustment entry in the books of the firm.