Question

Why are assets and liabilities revalued on the death of a partner?

Hint:

Revaluation = ensures fairness, avoids under/overpayment.

Answer 1

Step 1: Reason. Death leads to settlement of his/her capital account.
Step 2: Revaluation. - Assets must be shown at fair market value. - Liabilities must be recorded at actual payable amount.
Step 3: Result. Any profit/loss from revaluation is distributed to all partners’ capital accounts including the deceased partner.
Final Answer: \[ \boxed{\text{For fair settlement of deceased partner’s share}} \] % Quciktip