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Three partners have equal capitals but profit ratio is 2:2:1. On what basis will realisation profit be divided?

Answer and explanation

Correct answer: Profit sharing ratio

Realisation profit is shared in profit sharing ratio, equal capital does not change this rule. Keep capital and profit ratio separate in exams.

Related tags

DissolutionProfit Sharing RatioConceptPartner AccountsDissolution Of A Partnership FirmAccountancyClass 12 Mcq

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