What are the accounting aspects that are involved at the time of retirement or death of a partner?

A. Ascertainment of profit or loss upto the date of retirement or death of partner.

B. Realisation of assets and liabilities that are shown in the books of Accounting only.

C. Adjustment of capital.

D. Calculation of new profits sharing ratio and gaining ratio.

E. Treatment of goodwill

Choose the correct answer from the options given below :

A, C, D and E only

The correct answer is option 1- A, C, D and E only.

* Realisation of assets and liabilities that are shown in the books of Accounting only- The realisation of assets and liabilities are done at the time of dissolution of the firm not at the time of retirement or death of a partner.  At the time of retirement or death revaluation is done. So, the correct answer is option 1 i.e. A, C, D and E only.

The various accounting aspects involved on retirement or death of a partner are as follows:

• 1. Ascertainment of new profit sharing ratio and gaining ratio;
• 2. Treatment of goodwill;
• 3. Revaluation of assets and liabilities;
• 4. Adjustment in respect of unrecorded assets and liabilities;
• 5. Distribution of accumulated profits and losses;
• 6. Ascertainment of share of profit or loss up to the date of retirement/death;
• 7. Adjustment of capital, if required;
• 8. Settlement of the amounts due to retired/deceased partner