PARTNERSHIP FIRM

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anckoora (Querist)
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07 January 2011 DEAR SIR,
IN A PARTNERSHIP FIRM, THERE ARE FOUR PARTNERS HAVING EQUAL SHARE (25%). AS ON 01.01.2011, ONE PARTNER WANTS TO QUIT THE FIRM. sO WE PREPARED P/L & B/SHEET AS OF 31.12.2010. SO AS PER BALANCE SHEET OF 31.12.2010, RS.11,45,250/- STANDS TO THE CREDIT OF HIS CAPITAL A/C IN FIRM'S BOOKS.
ACCORDING TO MY KNOWLEDGE, IF WE HAVE TO PAY HIM ONLY RS.11,45,250/- AND THEN HE CAN QUIT. IS THIS RIGHT / OR ELSE WE HAVE TO PAY HIM / RECEIVE FROM HIM. PL. GUIDE.
THANKS
ANCKOORA.

Ravikant

Ravikant (Expert)
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08 January 2011 Yes you are correct, amount standing to the credit of the Capital a/c of a partner is payable to him while the debit balance is recoverable one. you can draft the retirement deed as such so as to convert the Capital balance as on 31.12.2010 as loan repayable to the retired partner and the manner of repayment.

anckoora

anckoora (Querist)
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10 January 2011 dear sir,
thanks.
But what about Fixed Assets of the Firm ? what about CC Limit of the bank standing in unsecured loans in balance sheet ? Don't we have to consider this aspects ? and why ? pl. explain. Only his credit balance we have to pay ?

Ravikant

Ravikant (Expert)
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10 January 2011 Please refer the original partnership deed, if it contains the manner of payment to retiring partner.99% it will be silent, hence what that partner will get is only the credit balance of his capital, other aspects aren't considered,

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