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A and B share profits in the ratio 1:5. C is admitted for a 1/3 share of the profits. If A and B sacrifice equally for C, what will be B’s new profit-sharing share?

Answer and explanation

Correct answer: 2/3

A’s and B’s old shares are 1/6 and 5/6, respectively. Since C receives 1/3 and A and B sacrifice equally, each sacrifices 1/3 ÷ 2 = 1/6. Therefore, B’s new share is 5/6 − 1/6 = 4/6 = 2/3. Hence, option C is correct. Exam tip: When sacrifice is equal, divide the incoming partner’s share equally among the sacrificing partners before subtracting it from each old share.

Related tags

Admission Of PartnerNew Profit Sharing RatioSacrifice RatioAccountancy Class 12Partnership AccountingReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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