A, B and C were partners in a firm sharing profits and losses in the ratio of 5:4:1. B died on June 30, 2025. The profit for the previous three years were Rs. 68,000 (For 2022-23), Rs. 77,000 (For 2023-24), Rs. 50,000 (2024-25) while the sales during the year 2024-25 were Rs. 4,00,000 and the sales from April 1, 2025 to June 30, 2025 were Rs. 75,000. Find the profits that the firm must have earned from the date of closing of last year's balance sheet till the date of death of B.
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Rs. 9,375
When the profit up to the date of death is to be estimated on the basis of sales, last year’s profit is spread over last year’s sales, and the same rate is applied to the sales made from the start of the year to the date of death.
Last year’s profit (2024-25) = Rs. 50,000 on sales of Rs. 4,00,000
Rate of profit on sales = 50,000/4,00,000 = 12.5%
Sales from April 1, 2025 to June 30, 2025 = Rs. 75,000
Profit for the period = Rs. 75,000 × 12.5% = Rs. 9,375
The profits of 2022-23 and 2023-24 are not used; they would matter only if the average profit of past years were the basis.
Note: NTA picked this question from an NCERT (2026-27) illustration and changed the figures. Do not ignore NCERT while practising numericals.
NCERT (2026-27 edition):
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