CBSE Class 12 Accountancy — Reconstitution of a Partnership Firm — Death of a Partner

Kiran, Raveena and Hina were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. The firm closes its books on 31st March every year. As per the terms of the partnership deed, on the death of any partner, the goodwill of the firm will be calculated on the basis of four times the average profits of the last three years. Hina died on 1st July 2025. The Profits for the last three years were : 2022-23 Rs. 4,75,000 2023-24 Rs. 4,05,000 2024-25 Rs. 3,20,000 Hina's share of profit upto the date of death was to be calculated on the basis of previous year's profit. (i) Calculate goodwill of the firm and Hina's share of goodwill. (ii) Calculate Hina's share in the profits of the firm till the date of her death. (iii) Pass necessary journal entries for the treatment of goodwill without opening goodwill account and for Hina's share of profit at the time of her death.