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When a New Partner Is Admitted into a Partnership and the Capital

question 57

Multiple Choice

When a new partner is admitted into a partnership and the capital of the old partners decreases,which of the following explains the reason for the decrease?
I.Undervalued liabilities were written up to their fair values.
II.Undervalued assets were written up to their fair values.


Definitions:

Conjunctive Adverbs

Words that connect clauses or sentences, showing relation in terms of time, cause, comparison, or contrast, such as however, therefore, moreover.

Punctuated Correctly

The use of proper punctuation marks in writing, following standard grammar rules to clarify meaning.

Conjunctions

Words used to connect clauses or sentences or to coordinate words in the same clause, such as "and," "but," or "if."

Conjunctive Adverbs

Words that connect two independent clauses or sentences, often showing cause and effect, contrast, or other relationships.

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