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A, B and C share profits in the ratio 3:1:6. C retires, and the new profit-sharing ratio of A and B is fixed at 2:1. What is B’s gain in share?

Answer and explanation

Correct answer: 7/30

B’s old share was \(1/(3+1+6)=1/10\). After C’s retirement, A and B share profits in the new ratio 2:1, so B’s new share is \(1/(2+1)=1/3\). Therefore, B’s gain is \(1/3-1/10=(10-3)/30=7/30\). Option 1/3 represents B’s new share, not the gain. Exam tip: Gain in share = New share − Old share.

Related tags

Gained ShareRetirement Of PartnerNew RatioProfit Sharing RatioAccountancyNew RatiosReconstitution Retirement Or Death Of A PartnerClass 12 Mcq

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