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A and B share the total profit in the ratio 4:5. B gives C a \(2/9\) share of the total profit from B’s own share. What will be the new profit-sharing ratio?

Answer and explanation

Correct answer: \(4:3:2\)

Initially, A’s share is \(4/9\) and B’s share is \(5/9\). Since C receives \(2/9\) of the total profit from B, A’s share remains \(4/9\), while B’s new share becomes \(5/9-2/9=3/9\). C’s share is \(2/9\). Therefore, the new ratio is \(4/9:3/9:2/9=4:3:2\). Option B is incorrect because it does not deduct C’s share from B’s original share. Exam tip: If the incoming partner acquires a share from only one old partner, reduce the share of only that partner.

Related tags

New Profit Sharing RatioAdmission Of PartnerOne Partner SacrificePartnership AccountsReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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