Deceased Partner’s Share

After a partner’s death, the amount due for capital, goodwill, accumulated profits and profit up to the date of death is paid to the legal representative because that person represents the deceased partner’s estate and lawful claim. The legal representative does not automatically become the new owner of the firm. Exam tip: In a partner’s death, transfer the amount due to the deceased partner’s account to the legal representative’s account.

The balance of the deceased partner’s Capital Account is included in the amount due to that partner. The final claim may also include the Current Account balance, share of goodwill, profit up to the date of death, and other relevant adjustments. Sales, Purchases and Expenses Accounts do not form part of the deceased partner’s personal claim. Exam tip: the final amount due is credited to the deceased partner’s account.

The deceased partner is entitled to his or her share of goodwill according to the profit-sharing ratio. Therefore, this amount is credited to the deceased partner’s capital or current account and becomes part of the amount payable to the executor. Option B is incorrect because it debits the partner’s account. Exam tip: On a partner’s death or retirement, that partner’s share of goodwill is credited to the partner’s account.

The deceased partner’s proportionate share of profit earned up to the date of death is payable to the deceased partner’s executor or legal representative. In the books, the amount may first be adjusted through the deceased partner’s capital account and then transferred to the executor’s account. Surviving or incoming partners are not entitled to this share. Exam tip: Profit up to the date of death is calculated through the Profit and Loss Adjustment Account.

The reserve fund represents accumulated past profits, so it is credited to the partners’ capital accounts in the old profit-sharing ratio. The deceased partner’s share is credited to that partner’s capital account and included in the amount payable. Exam tip: At the time of retirement or death, adjust the reserve fund in the old profit-sharing ratio.

The amount payable to a deceased partner includes the partner’s capital plus their share of goodwill. Therefore, total amount = ₹40,000 + ₹5,000 = ₹45,000. In the exam, identify capital, goodwill and any other adjustments separately before adding them.

If the amount due to a deceased partner is not paid immediately, it is transferred to the deceased partner’s Loan Account and shown as a liability of the firm. Stock, Purchase and Building Accounts relate to assets or trading transactions, so they are not appropriate for recording this amount. Exam tip: Remember that an unpaid amount due to a deceased partner is transferred to the partner’s Loan Account.

A partner’s rights in the partnership cease upon death. Therefore, the deceased partner’s account is credited with the share of profit earned up to the date of death, along with goodwill and other applicable adjustments; profits earned afterward belong to the continuing partners or are distributed according to the new partnership arrangement. Exam tip: Remember “profit up to the date of death,” not profit after it.

Accumulated profits, such as a general reserve, are distributed among all partners in the old profit-sharing ratio. Therefore, the deceased partner’s share is credited to the deceased partner’s Capital Account, increasing the amount payable to the partner’s estate. Deducting it would be the opposite treatment. Exam tip: When accumulated profits or reserves are distributed, the concerned partners’ Capital or Current Accounts are credited.

Balance payable = Total amount payable − Amount already paid = ₹70,000 − ₹10,000 = ₹60,000. Therefore, ₹60,000 is still payable to the deceased partner’s executor. Exam tip: subtract the amount already paid from the total amount due; ₹65,000 would result from subtracting only ₹5,000.

Revaluation profit is credited to the capital or current accounts of all the old partners in their old profit-sharing ratio. Therefore, the deceased partner’s share is credited to that partner’s account and included in the amount payable on the date of death. Option C is incorrect because the deceased partner is entitled to the share of profit up to the date of death under the old partnership arrangement. Exam tip: Add the deceased partner’s share of revaluation profit while calculating the amount due to the partner’s estate.

The amount due to a deceased partner is a liability of the firm because the firm has to pay it to the partner’s legal representative or nominee. Therefore, it is recorded as a liability in the firm’s books, not as income, profit, or an asset. Exam tip: an amount payable by the firm is treated as its liability.

The total is found by adding the deceased partner’s capital to their share of the reserve fund: ₹60,000 + ₹4,000 = ₹64,000. Therefore, option B is correct. Amounts such as ₹62,000 or ₹66,000 result from an incorrect addition or assuming an extra item not given in the question. Exam tip: Add only the adjustment items specifically provided in the question.

Drawings are debited to the partner’s capital or current account, reducing its balance. Therefore, the amount payable to the deceased partner on the date of death also decreases. Hence, option A is correct. Exam tip: Remember that drawings are deducted from the partner’s account.

Net amount payable = Total amount due − Drawings = ₹90,000 − ₹5,000 = ₹85,000. Therefore, option B is correct. ₹80,000 would result from deducting ₹10,000 instead of the given ₹5,000. Exam tip: drawings are deducted from the amount due to the partner when calculating the net payable amount.

Accumulated loss is debited to the partners’ capital or current accounts in the old profit-sharing ratio. Therefore, the deceased partner’s share of the loss reduces the balance of the partner’s account and consequently decreases the amount payable to the executor. Accumulated profits have the opposite effect and increase the claim. Exam tip: While calculating the deceased partner’s claim, add the share of accumulated profits and deduct the share of accumulated losses.

The amount credited is found by adding the deceased partner’s capital and their share of profit up to the date of death: ₹50,000 + ₹3,000 = ₹53,000. Therefore, option C is correct. In an exam, add only the items provided unless other adjustments, such as goodwill or drawings, are specifically mentioned.

The deceased partner had contributed to the firm’s reputation and earning capacity. Therefore, their share of goodwill is credited to their account so that the partner’s legal representative receives fair compensation. This amount is generally adjusted through the capital or current accounts of the continuing partners in their gaining ratio. Exam tip: In retirement or death adjustments, goodwill compensates the outgoing partner for their share in the firm’s goodwill.

Remaining amount payable = Total amount payable − Amount paid = ₹100000 − ₹20000 = ₹80000. Therefore, option C is correct. In such questions, subtract the amount already paid from the deceased partner’s total amount due.

The total amount due = capital + share of goodwill = ₹80,000 + ₹10,000 = ₹90,000. Therefore, option B is correct. The amount ₹95,000 includes an extra ₹5,000 that is not given in the question. In such questions, add only the specified capital and goodwill amounts.

The amount due after adjusting the deceased partner’s capital, current account and other relevant items is paid to the deceased partner’s legal representative. An accountant only records the transaction and is not entitled to receive the amount. Exam tip: After a partner’s death, the balance due is transferred to the account of the partner’s executor or legal representative.

The deceased partner’s share of accumulated loss is deducted from the amount due. Therefore, net amount = ₹65,000 − ₹5,000 = ₹60,000. ₹65,000 would be correct only if the loss were ignored. Exam tip: accumulated losses reduce the partner’s capital or amount payable.

The amount due to a deceased partner includes the partner’s capital and share in the reserve fund. Therefore, total amount = ₹70,000 + ₹8,000 = ₹78,000, so option B is correct. Exam tip: In such questions, add the given capital-related credits unless the question specifically mentions a deduction or debit.

New total amount = initial total amount + profit share = ₹85,000 + ₹5,000 = ₹90,000. Therefore, option B is correct. In such calculations, carefully check the operation and the number of zeros before selecting the answer.

Once the full amount due to the deceased partner has been paid, the firm's liability towards that partner is discharged because no amount remains outstanding. Therefore, option A is correct. Option C is incorrect because the liability does not continue after settlement. Exam tip: distinguish between determining the amount payable and actually paying it; the liability ends only after payment or settlement.