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A, B and C share profits in the ratio 3:5:2. C dies, and the firm’s goodwill is valued at ₹7,50,000. What amount will be credited to C’s Executor’s Account for goodwill?

Answer and explanation

Correct answer: ₹1,50,000

C’s share of the firm’s goodwill is calculated using the old profit-sharing ratio: 2 ÷ (3 + 5 + 2) = 1/5. Thus, ₹7,50,000 × 1/5 = ₹1,50,000 is credited to C’s Executor’s Account.

Related tags

GoodwillPartner DeathExecutor AccountProfit-Sharing RatioPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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