Question : If the death of a partner occurs on any day during the year, the executors of the deceased partner will also be entitled to the share of profits earned by the firm from the beginning of the year till the date of his death. Methods of calculating such profits are
Option 1: On Time Basis.
Option 2: On Turnover or Sales Basis.
Option 3: Both 1 and 2
Option 4: None of the above
Correct Answer: Both 1 and 2
Solution : Answer = Both 1 and 2
Both the Time Basis and Turnover/Sales Basis are methods for calculating the deceased partner's share of profits up to the date of death. Time Basis assumes uniform profit accrual throughout the year, while Turnover/Sales Basis estimates profits based on sales figures. The method used depends on the partnership agreement or negotiations.
Hence, the correct option is 3.
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