When a New Person Purchases the Partnership Interest of an Existing

question 39

Multiple Choice

When a new person purchases the partnership interest of an existing partner,which of the following is TRUE?

• A)The newly admitted partner will assume the same capital balance of the old partner regardless of the amount paid.
• B)The partnership will record either a gain or a loss if the amount paid is higher or lower than the existing partner's capital account balance.
• C)The amount paid for the partnership interest is recorded on the partnership books.
• D)The purchase price is determined by the balance in the existing partner's capital account.

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Definitions:

Jones And Davis

A theory proposing that people infer the intentions and dispositions of others based on observed behaviors and the consequences of those behaviors.

Kelley's Attribution Theory

A theory suggesting that individuals make sense of their social world by attributing causes to their own and others' behavior, focusing on consistency, distinctiveness, and consensus.

High Distinctiveness

A term in social psychology referring to the extent to which an individual's behavior can be attributed to the circumstances rather than internal traits.

Situational Attribution

The process of attributing behavior to external or environmental factors, rather than internal characteristics.