A and B share profits in 3 : 2. They admit C as a new partner and new profit sharing ratio between them becomes 2 : 1 : 2. Determine the sacrificing ratio between A and B.
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → 1 : 1
The sacrifice of each old partner is his old share minus his new share; the sacrificing ratio compares these two amounts.
Old ratio of A and B = 3 : 2, i.e. 3/5 and 2/5
New ratio of A, B and C = 2 : 1 : 2, i.e. 2/5, 1/5 and 2/5
A’s sacrifice = 3/5 − 2/5 = 1/5
B’s sacrifice = 2/5 − 1/5 = 1/5
Sacrificing ratio = 1/5 : 1/5 = 1 : 1