A, B and C are partners sharing profits in the ratio of 3:2:1. C died on 1^st July, 2023. On this date, final accounts were prepared to ascertain profits for the period. It resulted in a profit of ₹1,75,000 to the firm. To give effect to the above:

Correct option is A

The Profit and Loss Account will be debited to close the profit and later it is transferred profit and loss appropriation account for crediting it to partners' capital accounts. This entry is made to allocate the profit to A, B, and the deceased partner C in their profit-sharing ratio.