The Balance sheet of Himanshu, Pranav and Tushar who were sharing profits in proportion to their capital stood as follows:
| Balance Sheet as on 31 March 2022 |
|||
| Liabilities | Rs | Assets | Rs |
| Sundry Creditors | 25,000 | Land and Building | 35,000 |
| Investment Fluctuation Fund | 5,000 | Machinery | 45,500 |
| Bills Payable | 10,000 | Stock | 13,000 |
|
Capital: |
70,000 | Debtors | 6,000 |
| Investment | 5,000 | ||
| Bank | 4,000 | ||
| Profit and loss A/c | 1,500 | ||
| 1,10,000 | 1,10,000 | ||
Addition Information:
(a) On 1st April 2022, they admitted Rachit into partnership for 1/6th share in future profit.
(b) Rachit will bring ₹25,000 for capital and ₹15,000 for goodwill.
(c) A provision for doubtful debts of 7% was to be made.
(d) Land and building is to be appreciated to 120%.
(e) Machinery is decreased by ₹1,500.
On the basis of above case give answer to question:
Determine the new profit-sharing ratio among partners, after Rachit's admission.
Answer & explanation
Correct answer: option 2
The correct answer is option 2- 5:3:2:2.
Old ratio between old partners is capital ratio which means 35,000:21,000:14,000
= 5:3:2
Rachit share = 1/6
Total share = 1
Remaining share = 1- 1/6
= 5/6
This 5/6 share is distributed between old partners in old ratio to know their new share
Himanshu = 5/6 X 5/10
= 25/60
Parnav = 5/6 X 3/10
= 15/60
Tushar = 5/6 X 2/10
= 10/60
NEW RATIO = 25/60 :15/60:10/60:1/6
= 25/60 :15/60:10/60:10/60
= 25:15:10:10
= 5:3:2:2