Question

X, Y and Z are sharing profits and losses in the ratio of 5 : 3 : 2. With effect from 1st April, 2018, they decide to share profits and losses equally. Calculate each partner’s gain or sacrifice due to the change in ratio.

Answer 1

Solution:

Old Ratio (X, Y and Z)=5 : 3 : 2

New Ratio( X, Y and Z)=1 : 1 : 1

Sacrificing (or Gaining) Ratio= Old Ratio- New Ratio  

X' s Share = $\frac{5}{10} -\frac{1}{3}$ = $(\frac{15}{30}) -(\frac{10}{30})$ = $\frac{5}{30}$ (Sacrifice)

Y' s Share= $\frac{3}{10} -\frac{1}{3}$ = $(\frac{9}{30}) -(\frac{10}{30})$ = $\frac{-1}{30}$ (Gain)

Z' s Share= $\frac{2}{10} -\frac{1}{3}$ = $(\frac{6}{30}) -(\frac{10}{30})$ = $\frac{-4}{30}$ (Gain)

Y's Gain = 1 /30, Z's Gain = 4/ 30 and X' s Sacrifice= 5 /30