Question

At the time of retirement of a partner, profit on revaluation will be credited to ______.

Options

• Capital Account of retiring partner.

• Capital Accounts of all partners in the old profit sharing ratio.

• Capital Accounts of the remaining partners in their old profit sharing ratio.

• Capital Accounts of the remaining partners in their new profit sharing ratio.

Answer 1

At the time of retirement of a partner, profit on revaluation will be credited to capital Accounts of all partners in the old profit sharing ratio.

Explanation:

Profit on revaluation belongs to all partners, including the retiring partner, and is credited to their Capital Accounts in the old profit-sharing ratio.