Acc0805 death of a partner

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Acc0805 death of a partner

  1. 1. CPTSuccess<br />Revision Notes – Fundamentals of Accounting<br />Chapter 8. Partnership<br />Unit 5: Death of a Partner<br />
  2. 2. Chapter 8. Partnership<br />Unit 5: Death of a Partner<br /><ul><li> The problems arising on death of a partner are similar to those arising on retirement like revaluation of assets and liabilities, treatment of goodwill and Joint life policy etc. However, in case of death of a partner, the firm would get the joint life policy value instead of Surrender value which will be distributed in the old profit sharing ratio of the partners.
  3. 3. Joint life policy if shown in the balance sheet always appears at the surrender value i.e. the value expected to be realized on that date. </li></ul>©<br />Revision Notes - Fundamentals of Accounting<br />CPTSuccess<br />www.cptsuccess.com<br />
  4. 4. Chapter 8. Partnership<br />Unit 5: Death of a Partner<br /><ul><li> In addition, the representative of deceased partner will be entitled to partner’s share in profit and loss till the date of death. The amount due to deceased partner carries interest at the mutually agreed upon rate. In the absence of agreement, the representatives of the deceased partner can receive, at their option, interest at 6% p.a. or the share of profits earned for the amount due to the deceased partner. </li></ul>©<br />Revision Notes - Fundamentals of Accounting<br />CPTSuccess<br />www.cptsuccess.com<br />
  5. 5. CPTSuccess<br />

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