CA Foundation Exam > CA Foundation Questions > At the time of retirement of a partner, firm ...
Start Learning for Free
At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,
- a)Policy Amount.
- b)Surrender Value
- c)Policy Value for the retiring partner and Surrender Value for the rest.
- d)Surrender value for all the partners.
Correct answer is option 'B'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Verified Answer
At the time of retirement of a partner, firm gets ______ from the insu...
Most Upvoted Answer
At the time of retirement of a partner, firm gets ______ from the insu...
Understanding the Concept of Joint Life Policy in Partnerships
When a partner retires from a firm, the treatment of the Joint Life Policy taken out for all partners is essential for the financial settlement. The correct answer to the question is option 'B', which refers to the Surrender Value.
What is a Joint Life Policy?
- A Joint Life Policy is an insurance plan that covers multiple lives, typically taken by partners in a partnership firm.
- It provides a financial safety net for the partners and is beneficial in case of retirement, death, or any other unforeseen circumstances.
What Happens at Retirement?
- Upon the retirement of a partner, the insurance policy does not pay out the full policy amount directly.
Surrender Value Explained
- **Surrender Value** is the amount the insurance company pays to the policyholder if they decide to terminate the policy before its maturity date.
- It is calculated based on the total premium paid and the duration for which the policy has been held.
Why Option 'B' is Correct
- When a partner retires, the firm receives the **Surrender Value** of the Joint Life Policy as a financial settlement.
- This amount is crucial as it reflects the accumulated value of the policy, rather than the full policy amount, which might not be payable at retirement.
Conclusion
- The focus on Surrender Value ensures that the firm has cash flow to manage the retirement of the partner effectively.
- Therefore, it's vital for partners in a firm to understand the implications of a Joint Life Policy and how it impacts their financial dealings at the time of retirement.
When a partner retires from a firm, the treatment of the Joint Life Policy taken out for all partners is essential for the financial settlement. The correct answer to the question is option 'B', which refers to the Surrender Value.
What is a Joint Life Policy?
- A Joint Life Policy is an insurance plan that covers multiple lives, typically taken by partners in a partnership firm.
- It provides a financial safety net for the partners and is beneficial in case of retirement, death, or any other unforeseen circumstances.
What Happens at Retirement?
- Upon the retirement of a partner, the insurance policy does not pay out the full policy amount directly.
Surrender Value Explained
- **Surrender Value** is the amount the insurance company pays to the policyholder if they decide to terminate the policy before its maturity date.
- It is calculated based on the total premium paid and the duration for which the policy has been held.
Why Option 'B' is Correct
- When a partner retires, the firm receives the **Surrender Value** of the Joint Life Policy as a financial settlement.
- This amount is crucial as it reflects the accumulated value of the policy, rather than the full policy amount, which might not be payable at retirement.
Conclusion
- The focus on Surrender Value ensures that the firm has cash flow to manage the retirement of the partner effectively.
- Therefore, it's vital for partners in a firm to understand the implications of a Joint Life Policy and how it impacts their financial dealings at the time of retirement.
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Similar CA Foundation Doubts
Top Courses for CA FoundationView all
At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer?
Question Description
At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. 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 At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. 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 At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer?.
At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. 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 At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. 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 At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer?.
Solutions for At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer?, a detailed solution for At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer? has been provided alongside types of At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice At the time of retirement of a partner, firm gets ______ from the insurance company against the Joint Life Policy taken jointly for all the partners,a)Policy Amount.b)Surrender Valuec)Policy Value for the retiring partner and Surrender Value for the rest.d)Surrender value for all the partners.Correct answer is option 'B'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup