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If partner B’s old share is \(\frac{2}{5}\) and his new share is \(\frac{1}{2}\), what is B’s gaining ratio?

Answer and explanation

Correct answer: \(\frac{1}{10}\)

Gaining ratio = New share − Old share. Therefore, \(\frac{1}{2}-\frac{2}{5}=\frac{5-4}{10}=\frac{1}{10}\). Hence, option A is correct. \(\frac{3}{5}\) is the sum of the two shares, not the gain. In exams, calculate gaining ratio as new share minus old share.

Related tags

Gaining RatioGoodwill SettlementPartner RetirementShare CalculationReconstitution Retirement Or Death Of A PartnerAccountancyClass 12 Mcq

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