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Question
Nita, Suman and Harish were partners in a firm sharing profits in the ratio of 3: 2: 1. Suman retired from the firm. On the date of Suman’s retirement, ₹ 30,000 was due to her. The remaining partners decided to pay her in three yearly installments starting from the end of the first year. ₹ 30,000 will be transferred to which of the following account:
Options
Suman's Loan Account
Suman's Executor's Accounts
Suman's Bank Account
Suman's Current Account
Solution
Suman's Loan Account
Explanation:
When the remaining partners decides that the amount payable to the retiring partner will be paid in installment, the balance is his/her Capital Account is transferred to his/her Loan Account.
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