A, B and C are partners sharing profits in the ratio of 3 : 2 : 1. A retires and his share is taken up by B and C in the ratio of 3 : 2. Calculate the new profit sharing ratio.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → 19:11
Old Ratio of A, B, and C =3:2:1
A's share (Retiring Partner) =3/6
A's share is taken up by B and C in the ratio 3:2.
B's Gain: He takes 3/5 of A's share.
B’s Gain=3/6 * 3/5 = 9/30
C's Gain: He takes 2/5 of A's share.
C’s Gain=3/6 * 2/5 = 6/30
New Share=Old Share+Gain
B’s New Share=2/6 + 9/30 = 19/30
C’s New Share= 1/6+ 6/30 = 11/30
New Ratio of B and C= 19:11