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A and B share profits in the ratio 3:8. C is admitted for a \(2/11\) share of the total profit, acquired from A and B in the sacrificing ratio 4:1. What will be the new profit-sharing ratio?

Answer and explanation

Correct answer: 7:38:10

A and B initially have shares \(3/11=15/55\) and \(8/11=40/55\), respectively. C’s share is \(2/11=10/55\). Since the sacrificing ratio is 4:1, A sacrifices \(8/55\) and B sacrifices \(2/55\). Thus, A’s new share is \(15/55-8/55=7/55\), B’s is \(40/55-2/55=38/55\), and C’s is \(10/55\). Therefore, the new ratio is 7:38:10. Exam tip: Convert all shares to a common denominator before distributing the new partner’s share in the sacrificing ratio.

Related tags

AccountancyPartnership AdmissionSacrificing RatioNew Profit Sharing RatioShare CalculationReconstitution Admission Of A PartnerClass 12 Mcq

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