Death of a Partner Complete Chapter | CA Foundation Accounts | CA Foundation June 24 | ICAI Exam

Description :

A partnership firm is an organization that is formed with two or more individuals with a common objective to earn revenue. The structure of an organization and its capital tend to undergo massive change in the event of the admission of a new partner or the retirement or death of an existing partner. Notably, the accounting treatment in case of a retirement and death of a partner is not entirely different. On that note, let’s read along to find out more about the death of a partner in accounting and its impact on a firm’s capital. What Happens When a Partner Dies? In such a situation, the partnership deed after the death of a partner is terminated. Subsequently, the rights of the legal representatives of a deceased partner depend on the provisions of that firm’s partnership deed. In most cases, surviving partners decide to continue the venture and may end up purchasing the shares of their deceased partner once his/her due is computed and subsequently treated as a loan. 0:00 Intro 0:12 Death of Partner 20:27 How to Make Executor Loan Account 29:25 Loan Account