A and B are old partners sharing profits in the ratio of 2:3. At the time of admission of a new partner, the credit balance of the Profit and Loss Account amounting to ₹25,000 is to be distributed in the old ratio. What amount will be credited to B?

Correct answer: ₹15,000

The credit balance of the Profit and Loss Account is distributed among the old partners in their old profit-sharing ratio. B’s share is 3/5, so B’s amount = ₹25,000 × 3/5 = ₹15,000. ₹10,000 is A’s share, not B’s. Exam tip: For distributing accumulated profits or reserves, use the old profit-sharing ratio unless the question specifies otherwise.