CBSE 2024, Set 2

Question

Assertion (A): In a partnership firm, at the time of admission, the new partner brings in an agreed amount of capital either in cash or in kind.
Reason (R): In a partnership firm, at the time of admission, the new partner acquires the right to share the assets and the profits of the partnership firm.
Choose the correct option from the following: A). Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A). B). Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A). C). Assertion (A) is incorrect, but Reason (R) is correct. D). Assertion (A) is correct, but Reason (R) is incorrect.

Edvaya · Accepted Answer

The correct answer is Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).. Both Assertion (A) and Reason (R) are correct, and Reason (R) is the correct explanation of Assertion (A). When a new partner is admitted, they gain the right to share in the firm's future profits and its assets, which is exactly why they are required to bring in an agreed amount of capital.

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Accountancy > Accounting For Partnership Firms > Admission Of A Partner

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