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A and B share profits in the ratio of 3:1. C is admitted for a 1/4 share, and A alone sacrifices the entire share. What will be the sacrificing ratio of A and B?

Answer and explanation

Correct answer: A only

C’s entire 1/4 share is sacrificed by A alone. Therefore, A’s sacrifice is 1/4 and B’s sacrifice is zero, giving a sacrificing ratio of 1:0, expressed as ‘A only’. The goodwill benefit will also be credited only to A. Exam tip: normally, the sacrificing ratio is calculated as old ratio minus new ratio, but here the sacrificing partner is explicitly stated.

Related tags

GoodwillSacrificing RatioAdmission Of PartnerPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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