Question

03 A and B are sharing profits and losses in the ratio 3 : 2. They admitted C as a new partner to give him 2/10th share in the profit. The new profit sharing ratio will be: *

2 points

12 : 8 : 5

3 : 2 :2

3 : 2 :5

2 : 1 :2​

Answer 1

Given: Profit/loss sharing ratio between A and B = 3 : 2

           Share of new partner C = 2/10

To find: New profit sharing ratio

Let: Profit of firm = 1

Solution: According to the given question,

Share of C in the firm = 2/10

Remaining profit for A and B = 1 - 2/10 = 8/10

(A and B will share the remaining profit in their old ratio)

New share of A = 8/10 x 3/5 = 24/50

New share of B = 8/10 x 2/5 = 16/50

Share of C = 2/10 x 5/5 = 10/50 (converted 2/20 to an equivalent fraction with denominator 10 as in the shares of A and B)

Hence, new profit sharing ratio among A, B and C will be = 24 : 16 : 10 or 12 : 8 : 5