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Question
A partner retires from the partnership firm on 30th June. He is liable for all the acts of the firm up to the ______.
Options
End of the current accounting period
End of the previous accounting period
Date of his retirement
Date of his final settlement
Solution
A partner retires from the partnership firm on 30th June. He is liable for all the acts of the firm up to the date of his retirement.
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RELATED QUESTIONS
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Kannan, Rahim, and John are partners in a firm sharing profits and losses in the ratio of 5:3:2. The balance sheet as of 31st December 2017 was as follows:
| Liabilities | ₹ | Assets | ₹ | |
| Capital accounts: | Buildings | 90,000 | ||
| Kannan | 1,00,000 | 2,20,000 | Machinery | 60,000 |
| Rahim | 80,000 | Debtors | 30,000 | |
| John | 40,000 | Stock | 20,000 | |
| Workmen compensation funds | 30,000 | Cash at bank | 50,000 | |
| Creditors | 20,000 | Profit and loss A/c (loss) | 20,000 | |
| 2,70,000 | 2,70,000 |
John retires on 1st January 2018, subject to the following conditions :
- To appreciate building by 10%
- Stock to be depreciated by 5%
- To provide ₹ 1,000 for bad debts
- An unrecorded liability of ₹ 8,000 has been noticed.
- The retiring partner shall be paid immediately.
Prepare revaluation account, partner’s capital account, and the balance sheet of the firm after retirement.
