A and B share profits and losses in the ratio of 3 : 2. They admit C as a new partner for 1/3rd share in the profits of the firm which he acquired from A and B in the ratio of 2 : 3. After some time, they admitted D as a new partner for 1/5th share in the profits which he acquired equally from A and C. calculate new profit sharing ratio of A, B and C
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Explanation:
A's old ratio= 2/7
B's old ratio= 5/7
C is admitted for 1/4th share.
Remaining share=1-[1/4]
= 3/4
A's new share= 3/4 * 2/7
= 6/28
B's new share= 3/4 * 5/7
= 15/28
New Profit sharing ratio of partners=
6:15:7
(ii) Distribution of Goodwill:
A's share= 2/7 * 14000
= 4000
B's share= 5/7 * 14000
= 10000
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