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A, B and C share profits in the old ratio of 3:2:1. If C retires, what was C’s old share in the profits?

Answer and explanation

Correct answer: One-sixth

The total parts in the old ratio are 3 + 2 + 1 = 6. C has 1 part, so C’s old share of profits was 1/6, or one-sixth. The new ratio after retirement is not needed for this question. Exam tip: To find a partner’s old share, divide that partner’s ratio part by the sum of all ratio parts.

Related tags

Goodwill-SettlementOld-RatioPartner-RetirementProfit-SharingGoodwill SettlementReconstitution Retirement Or Death Of A PartnerAccountancyClass 12 Mcq

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