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A B and C share in 1:2:7. C retires and A B new ratio is 2:3. What will be the gaining ratio?

Answer and explanation

Correct answer: 3:4

The correct answer is Option A, 3:4. The old ratio A:B:C is 1:2:7, so A's old share is 1/10 and B's old share is 2/10. C retires. The new ratio of A and B is 2:3, so their new shares are 2/5 and 3/5. Calculate each gain separately. A's gain is 2/5 - 1/10 = 4/10 - 1/10 = 3/10. B's gain is 3/5 - 2/10 = 6/10 - 2/10 = 4/10. Therefore the gaining ratio is 3/10:4/10 = 3:4. Option A is correct. Option B, 2:3, is the new total profit-sharing ratio, not the gain ratio. Option C, 1:2, incorrectly compares the old shares or otherwise ignores the actual increases. Option D, 1:1, would mean both partners gained equally, but B gained 4/10 while A gained 3/10. The reliable method is always: new share minus old share for each continuing partner, followed by simplification. Memory cue: gain is not the new share; gain is only the increase.

Related tags

Gaining RatioLarge Retiring ShareExpert

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