Admission leads to reconstitution of firm as the existing agreement comes to an end and a new agreement comes into effect. A new partner may be admitted for increasing the capital, augmenting managerial skills, etc. Rights of new partner are right to share assets of the firm and to share future profits. On admission of a partner the adjustments are required for profit sharing ratio, goodwill, revaluation of assets and liabilities, reserves, accumulated profits/losses and capital. When a new partner is admitted into a partnership, he acquires his share of profit from the old partners which reduces their share of profits. Hence, it becomes necessary to calculate the new profit sharing ratio.