Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Admission of a Partner

Question:

A and B were partners in a firm sharing profit or loss equally. They agreed to share profits in the ratio of 4:5. Due to change in profit sharing ratio, B's gain or sacrifice will be:

Options:

1/18 gain

1/18 sacrifice

1/4 gain

1/4 sacrifice

Correct Answer:

1/18 gain

Explanation:

Sacrificing Ratio= Old Ratio – New Ratio
B = 1/2 -5/9 = - 1/18 (gain)