Question

What is meant by admission of partner? (Answer in one sentence)

Answer 1

Making someone new as a partner in an already existing firm or organization is called admission of partner.

The admitted partner is also called “incoming partner” or  “new partner” . A few things need to be restructured after the admission of a partner for example:

• Ratio of new profit  

• Sacrifice Ratio

• Treatment of Good Will  

• Capital Adjustment