Final answer:
The bonus received upon the admission of a new partner in a general partnership is allocated to the existing partners based on their agreed profit and loss sharing ratio. This reflects the old partners' contributions and risk, distinguishing it from a limited liability partnership which protects personal assets from business debts.
Step-by-step explanation:
When a new partner is admitted into a general partnership and the old partners receive a bonus, the bonus is typically allocated to the existing partners in their profit and loss sharing ratio. This means that only the current members of the partnership, not the new incoming partner, will share in the bonus. This allocation method is congruent with recognizing the contributions and risks taken by the existing partners prior to the admission of the new partner.
In the context of partnerships, it's important to consider the nature of both general partnerships and limited liability partnerships (LLP). General partnerships require a share in profits with partners and expose each to personal liability for all of the business's debts, which can include losing personal assets in a bankruptcy or lawsuit. On the other hand, a limited liability partnership provides the benefit of limiting a partner's liability to their investment in the company, thereby protecting personal assets.