how to calculate the gaining ratio at the time of retirement of a partner
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Explanation:
In this situation, we calculate the new profit sharing ratio of the remaining partners by simply removing the retiring partner's share.
Gaining Ratio = New Ratio – Old Ratio.
New Ratio = Old Ratio + Gain.
Gaining Ratio = Retiring partner's share x Acquisition Ratio.
New Ratio = Old Ratio + Gaining Ratio.
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