K, L, M and N are partners sharing profits in the ratio of 3 : 2 : 1 : 4. K retires and his share is acquired by L & M in the ratio of 3 : 2. Calculate new profit sharing ratio between L, M & N.
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) - 19 : 11 : 20.
K, L, M and N = 3 : 2 : 1 : 4
K retires and his share is acquired by L & M in the ratio of 3 : 2.
K's share = 3/10
L gains = 3/10 x 3/5
= 9/50
M gains = 3/10 x 2/5
= 6/50
L's new share = 2/10 + 9/50
= (10+9)/50
= 19/50
M's share = 1/10 + 6/50
= (5+6)/50
= 11/50
N's share = 4/10
NEW RATIO = 19/50 : 11/50 : 4/10
= 19/50 : 11/50 : 20/50
= 19:11:20