Identify the correct sequence to be followed at the time of Retirement of a Partner:

(A) New Balance Sheet after Retirement
(B) Transferring balance to Retiring partner's Loan Account
(C) Calculation Gaining/Sacrificing Ratio
(D) Partners' Capital Account
(E) Preparation of Revaluation Account

Choose the correct answer from the options given below:

(C), (E), (D), (B), (A)

The correct answer is option 2- (C), (E), (D), (B), (A).

*(C) Calculation Gaining/Sacrificing Ratio- First of all sacrificing ratio or gaining ratio are calculated at the time of retirement of a partner from a partnership firm. The gaining ratio refers to the proportion in which the continuing partners acquire the share previously held by a retiring or deceased partner. Gaining ratio is calculated by subtracting old ratio from the new ratio. If it is -ve then it will be sacrifice.

* (E) Preparation of Revaluation Account- Secondly, Revaluation A/c is made to revalue and reassess the assets and liabilities of the partnership firm.

*(D) Partners' Capital Account -  After it the capital account of the all the partners including deceased partner is made out to know the final balances of their capital account.

* (B) Transferring balance to Retiring partner's Loan Account - After the capital account, the deceased partner capital balance is transferred to the executor account in case of death and to loan account in case of retirement.

* (A) New Balance Sheet after Retirement- At last the balance sheet of the partnership firm is made to know the financial position of the firm.