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A and B share profits equally. C is admitted for a 1/4 share. If the remaining profit is shared equally by A and B, what is the new ratio?

Answer and explanation

Correct answer: 3:3:2

Let the total profit be 1. C receives 1/4, so the amount left for A and B is 1 − 1/4 = 3/4. The question specifically states that A and B divide this remainder equally, so each receives (3/4) ÷ 2 = 3/8. C’s share, 1/4, is equal to 2/8. Thus the three shares are 3/8, 3/8 and 2/8, which produce the new ratio 3:3:2. Therefore option A is correct. The ratio sums to 8, confirming the shares total one whole. Option B would give C only one-third, while options C and D do not preserve C’s fixed one-fourth share together with equal distribution of the remainder.

Related tags

New RatioEqual SharingAdmissionPartnership AccountsAccountancyClass 12 McqNew Profit Sharing RatioReconstitution Admission Of A Partner

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