When is the deceased partner’s share of profit up to the date of death estimated if the death occurs during the accounting year?

Correct answer: When the actual profit for that period has not yet been determined

When a partner dies before the end of the accounting year, the actual profit earned up to the date of death is generally not yet available. Therefore, the deceased partner’s share is estimated using methods such as time proportion, past profits, or sales and is credited to the partner’s Capital or Current Account. A zero profit in the previous year or an increase in sales alone does not create this requirement. Exam tip: If death occurs during the year and accounts are not finalised, estimate profit up to the date of death.