Question

A and B were partners in a firm sharing profits and losses in the ratio of 2 : 1. With effect from 1st April, 2019 they agreed to share profits and losses equally. Calculate the individual partner's gain or sacrifice due to change in ratio.

Answer 1

Answer:

Old Ratio of A and B = 2 : 1

New Ratio of A and B = 1 : 1

Sacrifice or gain :

A=23−12=4−36=16(Sacrifice)

B=13−12=2−36=16(Gain)

A has sacrificed 16th share wheras B has gained 16th share.