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Ashish and Bablu share profits in the ratio 5:4. Chanchal is admitted for \(\frac{1}{9}\) of the total profits, which is taken entirely from Bablu’s share. What will be the new profit-sharing ratio of Ashish, Bablu and Chanchal?

Answer and explanation

Correct answer: Ashish : Bablu : Chanchal = 5:3:1

The total of the old ratio 5:4 is 9, so Ashish’s share is \(\frac{5}{9}\) and Bablu’s share is \(\frac{4}{9}\). Since Chanchal’s \(\frac{1}{9}\) share is taken entirely from Bablu, Bablu’s new share becomes \(\frac{4}{9}-\frac{1}{9}=\frac{3}{9}\). Therefore, the new ratio is \(\frac{5}{9}:\frac{3}{9}:\frac{1}{9}=5:3:1\). Exam tip: Reduce the share only from the partner who sacrifices it for the incoming partner.

Related tags

Admission Of A PartnerNew Profit Sharing RatioSacrificing RatioClass 12 AccountancyReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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