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Question 47 Chapter 6 of +2-Part-1
47. (Deceased Partner's Share of Profit) A , B, and C are equal partners in a firm whose books are closed the 31st of December every year. A died on 31st March 2019 and according to the agreement, his share of profits up to the date of death is to be calculated on the basis of the average profits of the last three years. Net profits of the last three years were Rs. 8,000 ; Rs. 11,000 and Rs.17,000. Calculate A's share of profits and pass the necessary journal entry.
Journal
| Date | Particulars |
L.F. | Debit | Credit | |
|---|---|---|---|---|---|
| Profit & loss suspense A/c | Dr. | 1,000 | |||
| To A’s capital A/c | 1,000 | ||||
| (Being A’s share of profit up to date of death credited to his A/c ) | |||||
Working Notes :
Average annual profit
Profit for last 3 years = 8,000 + 11,000 + 17,000 = Rs 36,000
Average annual profit = 36,000 / 3 = Rs 12,000
| Profit up to 31st March | = | Rs. 12,000 | x | 3 |
| 12 | ||||
| = | Rs 3,000 |
| A’s share | = | Rs. 3,000 | x | 1 |
| 3 | ||||
| = | Rs 1,000 |
Comment if you have any questions.
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "Question 47 Chapter 6 of +2 Part-1 - USHA Publication 12 Class Part - 1", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to USHA Publication +2 Part 1.
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