From which of the following sources can partnership increase their capital?

A. Sales of shares
B. Admission of new partners
C. Discharge of mortgage
D. Grants from relatives

Correct Answer:

Option B – Admission of new partners

Explanation

Partnership: An association of two or more persons engaged in a business enterprise in which the profits and losses are shared proportionally. A partnership can maintain a single partnership capital account for all partners, with a supporting schedule that breaks down the capital account for each partner

Admission of new partners is a major source of increasing capital in partnership