Partners D, E, F, and G share profits 40%, 30%, 15%, and 15%, respectively. Their partnership agreement provides that in the event of the death of a partner, the firm shall continue until the end of the fiscal period. Profits shall be considered to have been earned proportionately during this period, and the deceased partner’s capital shall be adjusted by the proper share of the profit or loss until the date of death. From that date until the date of settlement with the estate, there shall be added interest of 6% computed on the adjusted capital. The remaining partners shall continue to share profits in the old ratio. Payment to the estate shall be made within one year from the date of the partner’s death. Partner G died on November 16. On December 31, the end of the six-month period, account balances on the partnership books before the income summary account is closed are as follows:
Partners D, E, F, and G share profits 40%, 30%, 15%, and 15%, respectively. Their partnership agreement provides that in the event of the death of a partner, the firm shall continue until the end of the fiscal period. Profits shall be considered to have been earned proportionately during this period, and the deceased partner’s capital shall be adjusted by the proper share of the profit or loss until the date of death. From that date until the date of settlement with the estate, there shall be added interest of 6% computed on the adjusted capital. The remaining partners shall continue to share profits in the old ratio. Payment to the estate shall be made within one year from the date of the partner’s death. Partner G died on November 16. On December 31, the end of the six-month period, account balances on the partnership books before the income summary account is closed are as follows:
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