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

Answer 1

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.