Law does not provide that at the time of admission of a partner assets be revalued and liabilities reassessed. Why are the assets revalued and liabili

Monjur Alahi

Law does not provide that at the time of admission of a partner assets be revalued and liabilities reassessed. Why are the assets revalued and liabilities reassessed?


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Salim Ahmed Kawsar

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When a partner is admitted the assets are revalued and liabilities are reassessed. The gain (profit) or loss, as the case may be is distributed among the old partners in their old profit-sharing ratio. It is done with a reason that the new partner is neither put to an advantege nor disadvantage because of increased value of assets or decreased liabilities and vice versa.

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