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Why are expenses incurred after the partner’s death not included in calculating the deceased partner’s share of profit?

Answer and explanation

Correct answer: They arise after death and do not relate to the deceased partner’s period

A deceased partner is generally entitled to a share of the profit earned up to the date of death. Expenses incurred after that date relate to the period in which the partner was no longer associated with the firm, so they are excluded from calculating the partner’s share. Option B is incorrect because some expenses may involve cash payments. Exam tip: Link the deceased partner’s profit entitlement specifically to the period ending on the date of death.

Related tags

AccountancyPartnership AccountsDeceased PartnerProfit CalculationRetirement Or DeathDeceased Partner’s ShareDeceased Partner S ShareReconstitution Retirement Or Death Of A Partner

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