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A B and C are in 3:5:2. B retires and A and C take B share in 1:1. What is the new ratio?

Answer and explanation

Correct answer: 11:9

The correct answer is Option A, 11:9. The old ratio A:B:C is 3:5:2, so their fractions are 3/10, 5/10 and 2/10. B retires and gives up 5/10. A and C acquire this surrendered share equally, so each receives 5/20, which is 1/4 or 2.5/10. A's new share is 3/10 + 2.5/10 = 5.5/10 = 11/20. C's new share is 2/10 + 2.5/10 = 4.5/10 = 9/20. Therefore the new ratio is 11:9. Option A is correct. Option B, 3:2, does not reflect the equal acquisition of B's share. Option C, 5:4, is close in appearance but does not result from the stated fractions. Option D, 1:1, would mean A and C receive equal total profits, whereas A already had a larger original share. A useful method is to convert all shares to a common denominator before adding the gain. Exam cue: new share equals old share plus acquired share; divide only the retiring partner's surrendered share according to the stated gaining ratio.

Related tags

Retiring B Equal ShareNew RatiosReconstitution Retirement Or Death Of A PartnerAccountancyClass 12 Mcq

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