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A, B, and C share profits in the ratio 5:4:3. C retires, and A and B acquire C’s share in their old ratio of 5:4. What is the new profit-sharing ratio?

Answer and explanation

Correct answer: 5:4

A and B acquire C’s 3/12 share in the ratio 5:4, so their gains are 5/36 and 4/36. Their new shares are 5/12 + 5/36 = 5/9 and 4/12 + 4/36 = 4/9. Thus, the new ratio is 5:4.

Related tags

New RatioRetirementGaining RatioNew RatiosReconstitution Retirement Or Death Of A PartnerAccountancyClass 12 Mcq

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