Question

Out of the following which is not a part of change in Profit sharing ratio:

a) Determination of sacrificing ratio and gaining ratio

b) accounting of goodwill

c) Accounting of reserves, accumulated profits and losses

d) dissolution of partnership firm​

Answer 1

Answer:

a) Determination of sacrificing ratio and gaining ratio

Answer 2

Answer:

The dissolution of a partnership firm is not a part of the change in the Profit sharing ratio. Hence, option D which states, " dissolution of partnership firm​" is the answer to the abovementioned question.

Explanation:

The profit-sharing ratio is defined as the profits or the losses taken by a specific business. The ratio depends from one firm to another. The change generally takes place whenever there's a change in the number of partners or the contributions provided by them. The above-defined change includes the following adjustments:-

• The accounting of Goodwill,
• The accounting of reserves, profits, and losses of the specific firm,
• The determination of sacrificing and gaining ratio,
• The adjustments of the capitals provided by the partners and
• The revalued figure of the assets and liabilities.

Thus, it is needless to say that Options A, B, and C are not the right answer to the above-mentioned question as it is included in the Profit-sharing ratio.

Hence we can safely conclude that Option D which states, "dissolution of partnership firm​" is the correct answer to the abovementioned question.

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