Home » MCQs » Commerce MCQs » Admission of New Partner MCQs

When a new partner brings his share of goodwill in cash, it will be shared with older partners at –

9. When a new partner brings his share of goodwill in cash, it will be shared with older partners at:

1. Ratio of sacrifice
2. Old profit-sharing ratio
3. New profit-sharing ratio
4. In capital ratio

Answer: A) Ratio of sacrifice

Explanation:

If the new partner is accepted by the old partner, he must give up his profit ratio in order to compensate the old partner and divide the favour according to their sacrificing ratio.