When a partnership is worth more than the amounts recorded,an incoming partner may:

Question

Quizplus · Accepted Answer

If the partnership is worth more than the amounts recorded, the existing partners may require the incoming partner to pay a bonus to compensate for the additional value of the partnership. This is known as a goodwill bonus and ensures that the incoming partner is paying their fair share for the partnership. Alternatively, the existing partners may choose to distribute the additional value of the partnership among themselves, but this would not be fair to the incoming partner who is contributing to the partnership's overall value. Therefore, option A is the best choice.

When a Partnership Is Worth More Than the Amounts Recorded,an