Question

State whether the following statement is True or False with reason.

A deceased partner is entitled to his share of General Reserve.

Options

• True

• False

Answer 1

This statement is True.

General reserve is created out of past undistributed profit. Past profit is earned due to the efforts and hard work of all the partners including a partner who is now dead. Hence a deceased partner has right on it and therefore a deceased partner is entitled to receive his share of General reserve.