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A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partner’s capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?
- a)Rs. 50,000 credited to all the partners in old ratio.
- b)Rs. 2,50,000 credited to all the partners in old ratio.
- c)Rs. 2,00,000 credited to all the partners in old ratio.
- d)No treatment is required.
Correct answer is option 'A'. Can you explain this answer?
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A, B and C takes a Joint Life Policy, after five years B retires from ...
Treatment in Partners Capital Account on Receiving JLP Amount
Circumstances: A, B, and C took a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. After five years, B retired from the firm. The old profit sharing ratio was 2:2:1. After B's retirement, A and C decided to share profits equally.
Treatment:
- As per the given information, the Joint Life Policy was taken jointly by A, B, and C. Therefore, the amount received on surrendering the policy will be credited to all the partners' capital accounts in their old profit sharing ratio.
- The surrender value of the policy is Rs. 50,000. The premium paid for the policy is not given, but as it is fully charged to revenue as and when paid, we can assume that the premium paid is equal to the surrender value of the policy.
- Therefore, the amount to be credited to each partner's capital account will be calculated as follows:
- A's share = 2/5 * Rs. 50,000 = Rs. 20,000
- B's share = 2/5 * Rs. 50,000 = Rs. 20,000
- C's share = 1/5 * Rs. 50,000 = Rs. 10,000
- After B's retirement, A and C decided to share profits equally. This means that their new profit sharing ratio is 1:1. Therefore, the amount credited to A and C's capital accounts will be shared equally between them.
- Hence, the final amount to be credited to each partner's capital account will be as follows:
- A's share = (Rs. 20,000 + 1/2 * Rs. 10,000) = Rs. 25,000
- B's share = Rs. 20,000
- C's share = (Rs. 10,000 + 1/2 * Rs. 10,000) = Rs. 15,000
- Therefore, the correct answer is option 'A' - Rs. 50,000 credited to all the partners in old ratio.
Circumstances: A, B, and C took a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. After five years, B retired from the firm. The old profit sharing ratio was 2:2:1. After B's retirement, A and C decided to share profits equally.
Treatment:
- As per the given information, the Joint Life Policy was taken jointly by A, B, and C. Therefore, the amount received on surrendering the policy will be credited to all the partners' capital accounts in their old profit sharing ratio.
- The surrender value of the policy is Rs. 50,000. The premium paid for the policy is not given, but as it is fully charged to revenue as and when paid, we can assume that the premium paid is equal to the surrender value of the policy.
- Therefore, the amount to be credited to each partner's capital account will be calculated as follows:
- A's share = 2/5 * Rs. 50,000 = Rs. 20,000
- B's share = 2/5 * Rs. 50,000 = Rs. 20,000
- C's share = 1/5 * Rs. 50,000 = Rs. 10,000
- After B's retirement, A and C decided to share profits equally. This means that their new profit sharing ratio is 1:1. Therefore, the amount credited to A and C's capital accounts will be shared equally between them.
- Hence, the final amount to be credited to each partner's capital account will be as follows:
- A's share = (Rs. 20,000 + 1/2 * Rs. 10,000) = Rs. 25,000
- B's share = Rs. 20,000
- C's share = (Rs. 10,000 + 1/2 * Rs. 10,000) = Rs. 15,000
- Therefore, the correct answer is option 'A' - Rs. 50,000 credited to all the partners in old ratio.
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A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer?
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A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer?.
A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer?.
Solutions for A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
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Here you can find the meaning of A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer?, a detailed solution for A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice A, B and C takes a Joint Life Policy, after five years B retires from the firm. Old profit sharing ratio is 2:2:1. After retirement A and C decides to share profits equally. They had taken a Joint Life Policy of Rs. 2,50,000 with the surrender value Rs. 50,000. What will be the treatment in the partners capital account on receiving the JLP amount if joint life premium is fully charged to revenue as and when paid?a)Rs. 50,000 credited to all the partners in old ratio.b)Rs. 2,50,000 credited to all the partners in old ratio.c)Rs. 2,00,000 credited to all the partners in old ratio.d)No treatment is required.Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
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