Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Admission of a Partner

Question:

Calculate the new profit-sharing ratio if A and B are partners in a firm sharing profits in ratio of 3:2, if C joins the firm and A surrenders 1/4th of his share and B surrenders 1/5th of his share in favour of C?

Options:

21:32:15

32:23:45

45:32:23

23:45:32

Correct Answer:

45:32:23

Explanation:

Old ratio = 3:2
sacrifice of A=1/4*3/5=3/20
Sacrifice of B= 1/5*2/5= 2/25
So, C new share = 3/20+2/25=23/100
A new share= 3/5-3/20=9/20
B new share= 2/5-2/25= 8/25
So, new ratio is 9/20:8/25:23/100 means 45:32:23