The firm’s average annual profit is ₹3,00,000. If a partner dies after 10 months of the accounting year, what will be the estimated profit of the firm up to the date of death?

Correct answer: ₹2,50,000

For a 12-month accounting year, the estimated profit for 10 months is ₹3,00,000 × 10/12 = ₹2,50,000. Therefore, option A is correct. ₹3,00,000 represents the annual average profit, so using it without proportioning for 10 months (option D) is incorrect. Remember that this is the firm’s profit; the deceased partner’s individual share would additionally require the profit-sharing ratio.