Question

On admission of a new partner, an increase in the value of assets is debited to ______

Options

• Profit and Loss Adjustment Account

• Assets Account

• Old Partners' Capital Accounts

• None of the above

Answer 1

On admission of a new partner, an increase in the value of assets is debited to Assets Account.

Explanation:

When a new partner is admitted, an increase in the value of assets is debited to the Assets account and reflected in the balance sheet and the Revaluation Account. It is credited to the Revaluation account, and the Profit and Loss-Adjustment and Old Partners Capital Account are not used for asset and liability revaluation.