Profit and Loss Suspense Account is debited at the time of death of partner.
For the share of profit from the date of last Balance Sheet till the date of death of partner.
When a partner dies, their profit share for the period between the last balance sheet and their death is calculated. This amount is credited to the Profit and Loss Suspense Account to ensure proper allocation among remaining partners.
Important Questions from Reconstitution of a Partnership : Retirement/Death of a Partner
The Deceased Partner’s Capital Account includes the following amounts/balances:
(A) Opening balance of his capital
(B) His share of profit/loss till the date of death
(C) His share of General Reserve
(D) His drawings till the date of death
(E) Amount paid to his executors
Choose the correct answer from the options given below:
A, B and C are partners sharing profits in the ratio of 3 : 2 : 1. C died on 1st July, 2023. On this date, final accounts were prepared to ascertain profits for the period. It resulted in a profit of ₹ 1,75,000 to the firm. To give effect to the above:
In the absence of any information regarding the acquisition of share in profit of the retiring partner by the remaining partners, it is assumed that they will acquire his/her share in:
Gobind, Hari, and Pratap are partners. On the retirement of Gobind, the goodwill already appears in the books at ₹24,000. The goodwill will be written off
In case of retirement, a retiring partner is entitled to get:
A. Share in profits made by the firm after his retirement
B. His share of Goodwill
C. His share in Accumulated Reserve
D. Share in Employees Provident Fund
Choose the correct answer from the options given below:
