Partnership

Retirement/Death

Medium

Naveen, Suresh and Tarun are partners sharing profits and losses in the ratio of 5:3:2. Suresh retires from the firm and his share was acquired by Naveen and Tarun in the ratio 2:1. The new profit sharing ratio is

2:1

7:3

5:2

3:2

✅ Correct Option: 2

Old profit sharing ratio of Naveen, Suresh and Tarun = 5:3:2

When Suresh retires, his share needs to be distributed between the remaining partners Naveen and Tarun.

Suresh's share = $\frac{3}{10}$

This share is acquired by Naveen and Tarun in the ratio 2:1.

Naveen's gain = $\frac{2}{3} \times \frac{3}{10} = \frac{2}{10}$

Tarun's gain = $\frac{1}{3} \times \frac{3}{10} = \frac{1}{10}$

New share of Naveen = Old share + Gain from Suresh's share

= $\frac{5}{10} + \frac{2}{10} = \frac{7}{10}$

New share of Tarun = Old share + Gain from Suresh's share

= $\frac{2}{10} + \frac{1}{10} = \frac{3}{10}$

New profit sharing ratio = $\frac{7}{10} : \frac{3}{10}$ = 7:3

2026: 13 May Shift 1

An existing partner of a firm passed away/died during the financial year. His share in estimated trading profits for the intervening period will be transferred to :

2026: 11 May Shift 1

The sum due to the retiring partner in case of retirement and to the legal representatives/ executors in case of death includes:

A. His share of goodwill

B. Credit balance of his current account

C. Salary/commission, if any

D. Provision for doubtful debts

Choose the correct answer from the options given below:

2025: 13 May Shift 1

In the absence of any information regarding the acquisition of shares in profit of the retiring/deceased partner by the remaining partners, it is assumed that they will acquire his share in:

2022: 20 July Shift 1

Monu, Sonu and Golu are partners in a firm sharing profits in the ratio of 2 : 2 : 1. Golu died on 5th November 2021. Under the partnership deed, the executors of the deceased partner are entitled to his share of profit to the date of death, calculated on the basis of last year's profit. Profit for the year ended 31st March 2022 was Rs. 3,00,000. Golu's share of profit will be :

2023: 28 May Shift 1

Lisa, Monika and Nisha are partners in a firm sharing profits and losses in the ratio of 2 : 2 : 1. Their capital A/c stood as Rs. 50,000, Rs. 50,000 and Rs. 25,000 respectively. Monika died and balance in the reserve on that date was Rs. 15,000. If goodwill of the firm is Rs. 30,000 and profit on revaluation is Rs. 7,050. What amount will be transferred to Monika's Executors Account ?

2026: 11 May Shift 1

Arrange the following steps in the order of the accounting treatment in case of death of a partner.

A. Adjustment of capital account of the existing partner.

B. Transfer of share of goodwill to deceased partner's capital account.

C. Transfer of amount from deceased partner's capital account to executor's account.

D. Calculation of New Profit Ratio and Sacrificing Ratio.

Choose the correct answer from the options given below:

Naveen, Suresh and Tarun are partners sharing profits and losses in the ratio of 5:3:2. Suresh retires from the firm and his share was acquired by Naveen and Tarun in the ratio 2:1. The new profit sharing ratio is

Solution

Related questions:

Keyboard Shortcuts

CUET Accountancy Past Year Questions (Topic-Wise)