Question:
A, B and C were partners in a firm sharing profits and losses in the ratio of 5:4:1. B died on June 30, 2025. The profit for the previous three years were Rs 68,000 (For 2022-23), Rs 77,000 (For 2023-24), Rs 50,000 (2024-25) while the sales during the year 2024-25 were Rs. 4,00,000 and the sales from April 1, 2025 to June 30, 2025 were Rs. 75,000. Find the profits that the firm must have earned from the date of closing of last year's balance sheet till the date of death of B.
A, B and C were partners in a firm sharing profits and losses in the ratio of 5:4:1. B died on June 30, 2025. The profit for the previous three years were Rs 68,000 (For 2022-23), Rs 77,000 (For 2023-24), Rs 50,000 (2024-25) while the sales during the year 2024-25 were Rs. 4,00,000 and the sales from April 1, 2025 to June 30, 2025 were Rs. 75,000. Find the profits that the firm must have earned from the date of closing of last year's balance sheet till the date of death of B.
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Use the sales basis on the last year's profit: 50,000 \(\times\) 75,000 / 4,00,000.
Updated On: Oct 1, 2026
- Rs 65,000
- Rs 18,750
- Rs 9,375
- Rs 3,750
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The Correct Option is C
Solution and Explanation
Step 1: Understand the concept.
When a partner dies during the year, his share of profit till the date of death is worked out. It is usually found on a time basis or on a sales basis. This question gives the sales figures, so the sales basis is used.
Step 2: Recall the formula.
On the sales basis, the profit till death is calculated on the last year's profit.
\[ \text{Profit till death} = \text{Last year's profit} \times \frac{\text{Sales from the start of the year to the date of death}}{\text{Total sales of last year}} \]
Step 3: Put in the values.
Last year (2024-25) profit is Rs 50,000. Sales from April 1, 2025 to June 30, 2025 are Rs 75,000. Sales of 2024-25 are Rs 4,00,000.
\[ \text{Profit} = 50{,}000 \times \frac{75{,}000}{4{,}00{,}000} \]
\[ = 50{,}000 \times 0.1875 = 9{,}375 \]
Step 4: Check the other options.
Rs 65,000 is the average of the three years profit, which is not the profit for three months. Rs 18,750 and Rs 3,750 do not come from the sales basis formula. If we used the three year average of Rs 65,000 we would get Rs 12,187.50, which is not in the options. So option 3 is the only fit.
Step 5: Note on the ratio 5:4:1.
The ratio 5:4:1 is needed only to find B's share. The question asks for the total profit of the firm, so the ratio is not used.
Final Answer:
The firm must have earned Rs 9,375 till the date of B's death.
\[ \boxed{\text{Rs } 9{,}375} \]
When a partner dies during the year, his share of profit till the date of death is worked out. It is usually found on a time basis or on a sales basis. This question gives the sales figures, so the sales basis is used.
Step 2: Recall the formula.
On the sales basis, the profit till death is calculated on the last year's profit.
\[ \text{Profit till death} = \text{Last year's profit} \times \frac{\text{Sales from the start of the year to the date of death}}{\text{Total sales of last year}} \]
Step 3: Put in the values.
Last year (2024-25) profit is Rs 50,000. Sales from April 1, 2025 to June 30, 2025 are Rs 75,000. Sales of 2024-25 are Rs 4,00,000.
\[ \text{Profit} = 50{,}000 \times \frac{75{,}000}{4{,}00{,}000} \]
\[ = 50{,}000 \times 0.1875 = 9{,}375 \]
Step 4: Check the other options.
Rs 65,000 is the average of the three years profit, which is not the profit for three months. Rs 18,750 and Rs 3,750 do not come from the sales basis formula. If we used the three year average of Rs 65,000 we would get Rs 12,187.50, which is not in the options. So option 3 is the only fit.
Step 5: Note on the ratio 5:4:1.
The ratio 5:4:1 is needed only to find B's share. The question asks for the total profit of the firm, so the ratio is not used.
Final Answer:
The firm must have earned Rs 9,375 till the date of B's death.
\[ \boxed{\text{Rs } 9{,}375} \]
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