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A and B shared profits in the ratio 7:3. After the admission of a new partner C, the new profit-sharing ratio A:B:C became 5:3:2. Which of A and B made no sacrifice?

Answer and explanation

Correct answer: B

A’s old share was 7/10, which decreased to 5/10, so A sacrificed 2/10. B’s old share was 3/10 and its new share is also 3/10; therefore, B made no sacrifice. The new partner C gained 2/10. Exam tip: calculate sacrifice by subtracting the new share from the old share.

Related tags

No SacrificeNew Profit Sharing RatioAdmission Of PartnerSacrifice RatioReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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