How the profit for the intervening period for the retiring partner is calculated at the time of retirement of the partner by following approach of average profit?

A) Divide the total profit by no of years
B) Calculate share of profit of retiring partner
C) Total the profits of the last few years
D) Pass the journal entry for the transfer of profit

Choose the correct answer from the options given below.

CABD

The correct answer is option 3- CABD.

If the partner's share of profit was to be calculated on the basis of average profits of the last few years, then calculate the total of the profits of last years and then divide it by the no of years to calculate the average profit. After it, partner's share of profit is calculated for the intervening period according to the partner's share on basis of average profit and at last journal entry is passed to transfer this share of profit. The Journal entry will be:
Profit and Loss Suspense A/c Dr.
   To Partner's Capital A/c