Skip to main content
Super TutorResources
Chapter 4 of 10
QuestionsNotesFlashcardsSummaryFormulasQuizConceptsSyllabusPlan
Revision Notes

Reconstitution of Partnership : Retirement of a Partner

ICSE · Class 12 · Accountancy

Quick revision notes for Reconstitution of Partnership : Retirement of a Partner — ICSE Class 12 Accountancy. Key concepts, formulas, and definitions for last-minute revision.

39 questions40 flashcards5 concepts

Interactive on Super Tutor

Studying Reconstitution of Partnership : Retirement of a Partner? Get the full interactive chapter.

Quizzes, flashcards, AI doubt-solver and a step-by-step study plan — built for revision notes and more.

Try Super Tutor — Free

1,000+ Class 12 students started this chapter today

Key Topics to Revise

1

1. Meaning and Effect of Retirement

  • Retirement of a partner means to discontinue to be a partner in the firm.
  • The partner leaving the firm is called the retiring partner or outgoing partner.
  • After retirement, the old partnership ends but the firm continues with the remaining partners.
2

2. Goodwill on Retirement

  • A retiring partner is entitled to his share of goodwill because the firm has earned goodwill through the efforts of all partners.
  • As per Accounting Standard 26, goodwill can be recorded in the books only when consideration in money or money’s worth has been paid for it.
  • Only purchased goodwill can be recorded in the books.
3

3. Revaluation of Assets and Liabilities

  • At retirement, assets and liabilities are revalued so that the retiring partner gets a fair share.
  • A Revaluation Account or Profit and Loss Adjustment Account is prepared.
  • In retirement, revaluation profit or loss is shared by all partners including the retiring partner.
4

4. Undistributed Profits, Losses, and Reserves

  • Accumulated profits and losses appearing in the books must be accounted for on retirement.
  • Undistributed profits such as General Reserve and Profit and Loss Account credit balance are transferred to partners’ capital/current accounts in old ratio.
  • Undistributed losses such as debit balance of Profit and Loss Account are written off to partners’ capital/current accounts in old ratio.

Get complete notes with diagrams and examples

Full Notes

Key Concepts

A partner retires when he discontinuesAfter retirementThe continuing partners share profitsThe gaining ratio is the ratioSacrificing ratio = Old ratio

Frequently Asked Questions

What are the important topics in Reconstitution of Partnership : Retirement of a Partner for ICSE Class 12 Accountancy?
Key topics in Reconstitution of Partnership : Retirement of a Partner include Complete Chapter Overview: Retirement of a Partner, Retirement of a Partner - Complete Chapter Overview, Partner Retirement Process Flow. These are the concepts ICSE Class 12 examiners draw on most — study them first, then practise related questions.
How to score full marks in Reconstitution of Partnership : Retirement of a Partner — ICSE Class 12 Accountancy?
Understand the core concepts first, then work through the 39 practice questions available for this chapter. Revise formulas and definitions regularly, and use flashcards for quick recall before the exam.

Sources & Official References

Content is aligned to the official syllabus. Refer to the board website for the latest curriculum.

More resources for Reconstitution of Partnership : Retirement of a Partner

All 10 chapters — ICSE Class 12 Accountancy Revision Notes

For serious students

Get the full Reconstitution of Partnership : Retirement of a Partner chapter — for free.

Quizzes, flashcards, AI doubt-solver and a step-by-step study plan for ICSE Class 12 Accountancy.

Try Super Tutor Free
Try the full chapter — Free