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A and B share profits in the ratio 6:7. New partner C is admitted for a 2/13 share of profits, which is sacrificed by A and B in the ratio 5:3. What will be the new profit-sharing ratio of A, B and C?

Answer and explanation

Correct answer: 19:25:8

C’s 2/13 share is sacrificed by A and B in the ratio 5:3. Therefore, A’s sacrifice is 2/13 × 5/8 = 5/52, and B’s sacrifice is 2/13 × 3/8 = 3/52. Converting the old ratio 6:7 to denominator 52 gives A’s and B’s old shares as 24/52 and 28/52. Their new shares are 19/52 and 25/52, while C receives 8/52. Hence, the new ratio is 19:25:8. Exam tip: Deduct the incoming partner’s share from the old partners in the given sacrificing ratio.

Related tags

Sacrificing RatioNew Profit Sharing RatioAdmission Of PartnerPartnership AccountsReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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