A, B, and C are partners sharing profits in ratio of 3:4:2. B wants to retire from the firm. The profit on revaluation on that date was Rs36,000. The new ratio of A and C is 5:3. Profit on revaluation will be distributed as:

A Rs12,000; B Rs16,000; C Rs8,000

The correct answer is option 2- A Rs12,000; B Rs16,000; C Rs8,000.

The profit on revaluation will be distributed between old partners in the old profit sharing ratio i.e 3:4:2. Thus, it will be distributed as follows:

Profit = ₹36,000

A's share = 36,000 x 3/9
                = 12,000

B's share = 36,000 x 4/9
                = 16,000

C's share = 36,000 x 2/9
                = 8,000

So, A Rs12,000; B Rs16,000; C Rs8,000