Arrange the following steps in correct sequence in case of retirement of a partner:
(A) Adjustment of Capital, if required
(B) Ascertain new profit sharing ratio and gaining ratio
(C) Distribution of Revaluation/Accumulated profits and losses
(D) Undertake revaluation of assets and liabilities
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → (B), (D), (C), (A)
On retirement the remaining partners first settle how they will share profits, then bring the books up to date, and only then fix the capitals. The steps follow the book’s order of the accounting aspects of retirement:
(B) Ascertain new profit sharing ratio and gaining ratio
(D) Undertake revaluation of assets and liabilities
(C) Distribution of Revaluation/Accumulated profits and losses
(A) Adjustment of Capital, if required
NCERT (2026-27 edition):
|
