The old profit sharing ratio among Gagan, Richa and Madhuri was 2:2:1. The new profit sharing ratio after Richa's retirement is 3:2. The gaining ratio is:
Answer & explanation
Correct answer: option 2
Correct answer: Option (2) → 1:1
Concept: Gaining ratio = New ratio – Old ratio, computed when a partner retires, as in Reconstitution of a Partnership Firm – Retirement/Death of a Partner.
Old ratio Gagan : Richa : Madhuri = 2 : 2 : 1; new ratio Gagan : Madhuri = 3 : 2 (out of 5).
Gagan gains = 3/5 – 2/5 = 1/5; Madhuri gains = 2/5 – 1/5 = 1/5.
Gaining ratio = 1/5 : 1/5 = 1 : 1.