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A, B and C share profits in the old ratio 1:3:2. After A retires, the new profit-sharing ratio of B and C is 5:4. What will be B’s new profit-sharing share?

Answer and explanation

Correct answer: 5/9

After A’s retirement, B and C share profits in the ratio 5:4. The total parts are 5+4=9, so B’s new share is 5/9. The fraction 4/9 represents C’s share, while 5/4 is the ratio itself, not an individual share. Exam tip: To find a partner’s share from a ratio, divide that partner’s ratio part by the sum of all ratio parts.

Related tags

Partner RetirementNew Profit Sharing RatioPartner ShareAccountancy Class 12New RatiosReconstitution Retirement Or Death Of A PartnerAccountancyClass 12 Mcq

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