When a partner is added to a partnership:
A) The previous partnership ends.
B) The underlying business operations end.
C) The underlying business operations must close and then re-open.
D) The partnership must continue.
E) The partnership equity always increases.

Question

Quizplus · Accepted Answer

When a new partner is added to a partnership, the original partnership agreement ends, and a new agreement must be formed to include the new partner. This does not necessarily mean the business operations end or must close and then re-open; it's a legal and financial restructuring.

When a Partner Is Added to a Partnership