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A B and C share in 3:1:6. C retires and the new ratio is 2:1. What is A gained share?

Answer and explanation

Correct answer: 11/30

A’s old share was 3/(3+1+6) = 3/10. After C’s retirement, the new ratio of A and B is 2:1, so A’s new share is 2/3. Therefore, A’s gain = new share − old share = 2/3 − 3/10 = 20/30 − 9/30 = 11/30. The value 3/10 is A’s old share, not the gain. Exam tip: A partner’s gaining share is calculated as new share minus old share.

Related tags

Gaining SharePartner RetirementNew RatioPartnership AccountingProfit Sharing RatioNew RatiosReconstitution Retirement Or Death Of A PartnerAccountancy

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