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Ramesh and Suresh share profits in the ratio 3:2. Dinesh is admitted for a 1/10 share of the profits. If Ramesh and Suresh each sacrifice 1/20, what will be the new profit-sharing ratio?

Answer and explanation

Correct answer: Ramesh : Suresh : Dinesh = 11 : 7 : 2

From the old ratio 3:2, Ramesh’s share is 3/5 and Suresh’s share is 2/5. The new share equals the old share minus the sacrifice: Ramesh = 3/5 − 1/20 = 11/20, and Suresh = 2/5 − 1/20 = 7/20. Dinesh receives 1/10 = 2/20. Therefore, the new ratio is 11/20 : 7/20 : 2/20 = 11:7:2. Exam tip: Convert all shares to a common denominator before forming the ratio.

Related tags

Admission Of A PartnerNew Profit Sharing RatioSacrificing RatioPartnership AccountsClass 12 AccountancyReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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