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Abhi and Ruchi share profits in the ratio 1:3. Khushi is admitted as a partner for a 1/4 share of profits, which is given by Abhi and Ruchi in their old ratio. What will be the new profit-sharing ratio?

Answer and explanation

Correct answer: Abhi : Ruchi : Khushi = 3 : 9 : 4

Khushi receives 1/4 of the profit, so the share remaining for the old partners is 3/4. Distributing this remainder in Abhi and Ruchi’s old ratio of 1:3 gives Abhi (3/4) × (1/4) = 3/16 and Ruchi (3/4) × (3/4) = 9/16. Khushi’s share is 1/4 = 4/16. Therefore, the new ratio is 3/16 : 9/16 : 4/16 = 3:9:4. Exam tip: When the new partner’s share is sacrificed by the old partners in their old ratio, first find the remaining share and distribute it in that ratio.

Related tags

Admission Of A PartnerNew Profit Sharing RatioOld RatioSacrifice RatioClass 12 AccountancyReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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