Question

Nicku, Mala, and Ritu were partners in a firm sharing profits in the ratio of \( 5 : 3 : 2 \). Nicku died on 30\textsuperscript{th September, 2023. The deceased partner was entitled to his share of profit up to the date of death, which was to be calculated on the basis of the previous year’s profit. The previous year’s profit was ₹ 80,000. Nicku’s share of profit will be:}

• A. ₹ 10,000
• B. ₹ 20,000
• C. ₹ 30,000
• D. ₹ 40,000

Hint:

Always adjust for the months active to calculate the share of profit correctly for a deceased partner.

Answer 1

The Correct Option is B

Nicku’s share of profit is calculated using the formula: \[ \text{Share of Profit} = \text{Previous Year’s Profit} \times \frac{\text{Share Ratio}}{\text{Total Ratio}} \times \frac{\text{Months Active}}{12}. \] Substituting the values: \[ \text{Share of Profit} = ₹ 80,000 \times \frac{5}{10} \times \frac{6}{12} = ₹ 20,000. \]