Reconstitution of a Partnership Firm – Retirement/Death of a Partner · Class 12 · CBSE · Commerce Accountancy
A, B and C share profits equally. C dies on 30 June. The profit for the preceding year was ₹1,20,000, and the partnership agreement provides that C's…
Practice question from Reconstitution of a Partnership Firm – Retirement/Death of a Partner (Class 12 · CBSE · Commerce Accountancy), with the correct answer and a step-by-step solution.
easy · MCQ · Q-7606DC
A, B and C share profits equally. C dies on 30 June. The profit for the preceding year was ₹1,20,000, and the partnership agreement provides that C's share of profit up to the date of death will be calculated on the basis of time. What amount will be credited to C's Capital Account through the Profit and Loss Suspense Account?
- A.₹10,000
- B.₹20,000Correct answer
- C.₹40,000
- D.₹60,000
Solution
Estimated profit up to death = ₹1,20,000 × 6/12 = ₹60,000. C's one-third share is ₹60,000 × 1/3 = ₹20,000, which is credited through the Profit and Loss Suspense Account.
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