Q.4. A, B and C Are Partners Sharing Profits in 2:2:1 Ratio Admitted D for 1/8 Share Which He Acquired Entirely from A.

Q.4. A, B and C Are Partners Sharing Profits in 2:2:1 Ratio Admitted D for 1/8 Share Which He Acquired Entirely from A. Calculate New Profit Sharing Ratio?

SOLUTION

Partner A,B and C’s old profit sharing ratio = 2:2:1

New partner D’s share = 1/8

Partner D Acquired his share from A

A’ s share = old share – share acquired from new partner D

= 2/5 – 1/8

=11/40

New ratio = A:B:C:D

=11/40 : 2/5 : 1/5 : 1/8

=11:16:8:5

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