The effect of the admission of a new partner is
A) to have no effect on the capital balances of the original partners
B) impossible to determine from the information given
C) to decrease the capital balances of the original partners
D) to increase the capital balances of the original partners

Question

Quizplus · Accepted Answer

The effect of admitting a new partner on the capital balances of the original partners depends on the terms of the partnership agreement and cannot be determined without additional information. It could lead to an increase or decrease of their capital balances or have no effect at all.

The Effect of the Admission of a New Partner Is