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After the retirement or death of a partner, the new ratio of the remaining partners is 13:7. What will be the respective new shares of the first and second remaining partners in the total profit?

Answer and explanation

Correct answer: 13/20 and 7/20

The total of the new ratio 13:7 is 13 + 7 = 20. Therefore, the first partner’s share in the total profit is 13/20 and the second partner’s share is 7/20. Option C reverses the partners’ shares, while option B gives reciprocal values rather than shares. Exam tip: To convert a ratio into shares, divide each ratio term by the sum of all ratio terms.

Related tags

New RatioPartner RetirementProfit Sharing RatioRatio To ShareRemaining PartnersNew RatiosReconstitution Retirement Or Death Of A PartnerAccountancy

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