Question

1.
In case of retirement of a partner, profit or loss on revaluation of
assets
and re-assessment of liabilities is distributed among
partners in
ratio.​

Answer 1

In case of retirement of a partner, profit or loss on revaluation of

assets and re-assessment of liabilities is distributed among partners in ratio.​

Explanation:

Before a new partner is introduced in a partnership firm  all the assets and liabilities should be valued correctly.

• The assets are overvalued or undervalued are revalued.
• The liabilities are recorded correctly.
• Unrecorded assets and liabilities of the firm are recorded
• The  position of the firm is computed

Profit and loss accruing on the partnership account of such revaluation up to the date of admission of the new partner may be adjusted in the partner’s capital accounts in their prior profit sharing ratio.