When the deceased partner's share in the estimated loss is calculated for a period from the date of the latest Balance Sheet to the date of death of the partner, then:

Profit and Loss Suspense Account will be credited and Deceased Partner's Capital Account will be debited.

The correct answer is Option (4) → Profit and Loss Suspense Account will be credited and Deceased Partner's Capital Account will be debited.

• When a partner dies, his share of profit or loss from the date of the last Balance Sheet to the date of death is estimated.

• If it is a loss, it must be borne by the deceased partner as well.

• Therefore, the Deceased Partner’s Capital Account is debited (reducing his entitlement).

• The corresponding entry is to credit Profit and Loss Suspense Account (since the firm has not yet closed its books for the year, and this account temporarily records such adjustments).

  Deceased Partner’s Capital A/c Dr.          To Profit and Loss Suspense A/c Cr