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Question
Share of profit or a deceased partner till the date of his death is ____________
a. debited to profit and loss adjustment account
b. credited to profit and loss adjustment account.
c. debited to profit and loss suspense account.
d. credited to profit and loss suspense account.
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Solution
Share of profit of a deceased partner till the date of his death is debited to profit and loss suspense account.
Explanation: The deceased partner is entitled to receive his/her share in the profit or loss earned or incurred by the firm till his/her date of death. But, practically it is not possible to close the books of accounts during an accounting period. Thus, share of profit of a deceased partner is debited to Profit and Loss Suspense Account.
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