Q. 9. A, B and C are partners in a firm sharing profits in 4:3 :3 ratio. They decided
to admit their manager D into partnership. A surrendered - of his share in favour of D:
1
B surrendered of his share in favour of D and C surrendered - of his share in favour
C be
of D. Calculate new profit sharing ratio.
Answers
Explanation:
(i) R's old share= 3/5
T's old share= 2/5
R's sacrifice= 3/5 * 1/4
= 3/20
T's sacrifice= 2/5 * 1/5
= 2/25
New Profit Sharing ratio of the partners:
R= 3/5-3/20
= 9/20
T= 2/5-2/25
= 8/25
S= 3/20 + 2/25
= 23/100
Therefore,
Profit sharing ratio= 45:32:23
(ii) A's old share= 1/2
B's old share= 1/2
C is admitted for 1/4th share
Remaining share= 1-[1/4]
= 3/4
New Ratio between A and B should be 2:1
Hence, A's new share= 2/3 * 3/4
= 6/12
B's new share= 1/3 * 3/4
= 3/12
New Profit sharing ratio= 6:3:3
= 2:1:1
(iii) A's old share= 3/5
B's old share= 2/5
C is admitted for 1/5th share in the profit.
A's sacrifice= 1/5 * 1/5
= 1/25
B's sacrifice= 1/5 * 4/5
= 4/25
New profit sharing ratio of the partners:
A's new share= 3/5-1/25
= 14/25
B's new share= 2/5-4/25
= 6/25
C's share= 1/5
Ratio= 14:6:5
(iv) X's old share= 3/6
Y's old share= 2/6
Z's old share= 1/6
W is admitted for 1/6th share. Since, Z would retain his original share;
Remaining share= 1-[1/6]-[1/6]
= 4/6
X's new share= 4/6 * 3/5
= 12/30
Y's new share= 4/6 * 2/5
= 8/30
New Profit sharing ratio= 12:8:5:5
(v) A's old share= 1/2
B's old share= 1/2
C and D are admitted for 1/5th and 1/6th share respectively.
Hence, remaining share= 1- [1/5]- [1/6]
= 19/30
A's new share= 1/2 * 19/30
= 19/60
B's new share= 1/2 * 19/30
= 19/60
New Profit Sharing ratio= 19:19:12:10
(vi) A's old share= 3/5
B's old share= 2/5
C is admitted for 1/4th share.
Remaining share= 1-[1/4]
= 3/4
Since, A and B will share equally, their ratio is 1:1
A's new share= 1/2 * 3/4
= 3/8
B's new share= 1/2 * 3/4
= 3/8
New Profit sharing ratio= 3:3:2