The following will not be deducted from the sum due to the retiring p…

The following will not be deducted from the sum due to the retiring partner:

Answer & explanation

Correct answer: option 3

The correct answer is Option (3) → Credit balance of his current account (if any).

The sum due to a retiring partner is built up from what the firm owes him (his capital, a credit balance of his current account, his share of goodwill, reserves and revaluation gain), and then the amounts he must bear or owes the firm are taken off. A credit balance of his current account is money the firm owes him, so it is added to the sum due, not deducted.

Option (1) His share of goodwill to be written off, if necessary. — Deducted from the sum due. Goodwill already in the books is written off among all the partners, so the retiring partner bears his share of it.
Option (2) His share of accumulated losses. — Deducted from the sum due. A debit balance of the Profit and Loss Account is a loss of all the partners, the retiring one included.
Option (4) His share of loss on revaluation of assets and liabilities. — Deducted from the sum due. A fall in the values found on revaluation belongs to the old partners in the old ratio.

NCERT (2026-27 edition):
Ascertaining the Amount Due to Retiring/Deceased Partner – “The sum due to the retiring partner (in case of retirement) and to the legal representatives/ executors (in case of death) includes: (i) credit balance of his capital account; (ii) credit balance of his current account (if any); … The following deductions, if any, may have to be made from his share: (i) debit balance of his current account (if any); (ii) his share of goodwill to be written off, if necessary; (iii) his share of accumulated losses; (iv) his share of loss on revaluation of assets and liabilities; (v) his share of loss up to the date of retirement/death; (vi) his drawings up to the date of retirement/death; (vii) interest on drawings, if involved, up to the date of retirement/death.”

The following will not be deducted from the sum due to the retiring partner:

Answer & explanation

Correct answer: option 3

The correct answer is Option (3) → Credit balance of his current account (if any).

Option (1) His share of goodwill to be written off, if necessary. — Deducted from the sum due. Goodwill already in the books is written off among all the partners, so the retiring partner bears his share of it.
Option (2) His share of accumulated losses. — Deducted from the sum due. A debit balance of the Profit and Loss Account is a loss of all the partners, the retiring one included.
Option (4) His share of loss on revaluation of assets and liabilities. — Deducted from the sum due. A fall in the values found on revaluation belongs to the old partners in the old ratio.