Question

When firm pays an amount in excess of total amount due to the retiring partner, then excess

amount is treated as _______________​

Answer 1

Answer:

ok I will.......... ..................

Answer 2

Answer:

The surplus of net assets acquired by the retiring partnership beyond the credit balance reflected in their cash book would typically be considered a gain for the retiring partner. A capital gain assessment might have been made of this gain in the firm's favour under Section 45(4) of a Act. According to the terms of the partnership agreement or as otherwise mutually agreed upon, the amount payable to a retiring partnership is settled in a lump payment or in instalments.

Explanation:

The balance of the retiring partner's capital account after deductions for goodwill, accrued profits and losses, profits and losses on revaluation, remuneration payable, etc. is the amount owed to him by the partnership firm. settlement of the retiring partner's outstanding debt.

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