Question

A newly admitted partner acquires two main rights in the partnership firm.
Identify the correct rights of the newly admitted partner.
(A) Right to share assets of the partnership firm
(B) Right to claim interest on capital
(C) Right to claim remuneration for firm’s work
(D) Right to share profits of the partnership firm
Choose the correct answer from the options given below:

• (A) and (D) only
• (B) and (C) only
• (C) and (D) only
• (B) and (D) only

Answer 1

The Correct Option is A

Upon admission to a partnership, a new partner gains specific entitlements within the firm. The two principal rights accorded to a newly admitted partner are:

• Right to share partnership firm assets: A newly admitted partner is entitled to a portion of the firm's assets, which encompasses participation in asset distribution during dissolution or as stipulated by the partnership agreement.
• Right to share partnership firm profits: The new partner has the right to a share of the firm's profits, determined by the agreed-upon profit-sharing ratio.

However, a newly admitted partner does not inherently possess the right to claim:

• Interest on capital: This entitlement typically stems from the partnership agreement and is not a fundamental right for a new partner.
• Remuneration for firm's work: This is generally compensated to active partners and is not a universal right for all partners.

The definitive rights of a newly admitted partner are (A) Right to share partnership firm assets and (D) Right to share partnership firm profits.

Therefore, the correct selection is (A): (A) and (D) only.