A and B share profits in the ratio of 3 : 4. They admitted C for 1/5th share in future profits with a guarantee that his share of profits shall be at at least 30,000.

In the above case, any deficiency to C will be borne by A and B in the ratio of :

3 : 4

The correct answer is option 2- 3 : 4.

Sometimes, a partner may be guaranteed a minimum amount by way of his share in profits. If, in any year, the share of profits as calculated according to his profit sharing ratio is less than the guaranteed amount, the deficiency is made good by the guaranteeing partners’ in the agreed ratio which usually is the profit sharing ratio. If, however, such guarantee has been given by any of them, he or they alone shall bear the amount of deficiency.

As no particular ratio is given for the deficiency then it will be shared among the partners in their profit sharing ratio i.e. 3 : 4.