A's new profit share is \(\frac{2}{5}\) and B's new profit share is \(\frac{7}{20}\). What will be C's new profit share and the new profit-sharing ratio of all three partners?

Correct answer: \(\frac{1}{4}\) and \(8:7:5\)

The total profit share is taken as \(1\). Therefore, C's new share is \(1-\frac{2}{5}-\frac{7}{20}=\frac{20-8-7}{20}=\frac{5}{20}=\frac{1}{4}\). Thus, \(\frac{2}{5}:\frac{7}{20}:\frac{1}{4}\), after multiplying each term by 20, becomes \(8:7:5\). Option C incorrectly calculates C's share as \(\frac{3}{20}\). Exam tip: Convert all fractional shares to a common denominator before forming the new ratio.