1.

Explain the meaning of partnership reconstruction and the circumstance for reconstruction.

Answer»

“Changes in the partnership due to several reasons’ is known as reconstruction of partnership.

Following are the circumstances / reasons for reconstruction :

  1. Change in the profit and loss sharing ratio between the continuing partners.
  2. Admission of a new partner in the existing partnership firm.
  3. Retirement or death of a partner of the existing partnership firm.
  4. Current partnership firm is connected with one or more than one partnership firm.


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