A and B Were Partners in a Firm Sharing Profits and Losses in the Ratio of 3:2. - Bzziii.com

A and B Were Partners in a Firm Sharing Profits and Losses in the Ratio of 3:2. They Admit C into the Partnership with 1/6 Share in the Profits. Calculate the New Profit Sharing Ratio?



Partner’s A and B Were Sharing Profits in 3:2

A’s Old profit sharing ratio = `3/5`

B’s Old profit sharing ratio = `2/5`

Let’s be the firm’s share= 1

Remaining share of A and B after c’s admission = total share- partner c’s share

= 1 – `1/6`

= `5/6`

New ratio = Old ratio X Remaining share of A and B after c’s admission

A = `3/5` X `5/6`

= `15/30`

B = `2/5` X `5/6`

= `10/30`

New ratio = A : B: C

=`15/30` : `10/30``: `1/6`

= `15/30` : `10/30` : `5/30`

= 15 : 10 : 5

= 3 :2 : 1

Chapter-3 Reconstitution of Partnership Firm

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