If the annual profit of the previous year was ₹72,000 and a partner died 2 months into the current year, what would be the estimated profit up to the date of death, assuming profits accrue evenly?

Correct answer: ₹12,000

Estimated profit up to the date of death = Previous year’s annual profit × fraction of the year elapsed = ₹72,000 × 2/12 = ₹12,000. This calculation assumes that profits accrue evenly throughout the year. ₹24,000 represents four months’ profit, so it is not correct for two months. In the exam, divide the elapsed months by 12 before multiplying by the annual profit.