The total sum due to a retiring partner or to the legal executors (in case of death) includes which of the following, along with their capital account balance, share of goodwill, and revaluation profit?
- ADirect physical assets of the firm
- BShare in accumulated profits and profits up to the date of retirement/death
- CShare in accumulated profits and profits up to the date of retirement/death along with personal funds contributed by other partners
- DShare in Realisation profits
Solution & Step-by-step Explanation
In addition to the closing balance of capital, a retiring partner or deceased partner's executor is legally entitled to:Accumulated reserves and undistributed profit balances.Accrued business operating profits computed from the start of the financial year up to their exact date of departure or death (usually adjusted using a P&L Suspense Account).Thus, option B accurately captures these components.