Question

A, B and C were partners in a firm sharing profits in 1 : 2 : 3 ratio. They admitted D as a new partner for `1/6` th share. D acquired his share `1/24` from A, `1/24` from B and `1/12` from C. Calculate new profit sharing ratio.

Answer 1

1. Old profit-sharing ratio

A : B : C = 1 : 2 : 3

So their shares are:

A = `1/6 = 4/24`

B = `2/6 = 8/24`

C = `3/6 = 12/24`

2. D's share

D gets:

`1/24 + 1/24 + 1/12`

`(1 + 1 + 2)/24`

`4/24`

`1/6`

3. Calculate remaining shares

A: `4/24 - 1/24 = 3/24`

B: `8/24 - 1/24 = 7/24`

C: `12/24 - 2/24 = 10/24`

D: `4/24`

Therefore, the new profit-sharing ratio is:

A : B : C : D = 3 : 7 : 10 : 4