Question

A, B, C were partners in a firm sharing profits in 3:2:1 ratio. They admitted D for 10% profits. Calculate the new profit sharing ratio?

Answer 1

Old Ratio = A    :  B    :  C
                   3     :  2     :  1
                = `3/6 : 2/6  : 1/6`

D admits for  `10/100` share in the new firm
Let new firm profit = 1
Remaining share of A, B and C in new firm = 1 − D’s share
= 1 - `10/100`
= `90/100`
= `9/10`

New Ratio = Old Ratio × Remaining Share of A, B and C in new firm
A = `3/6 xx 9/10`
   = `27/60`

B = `2/6 xx 9/10`
   = `18/60`

C = `1/6 xx 9/10`
   = `9/60`
New Ratio = A  :  B:  C:  D

                  = `27/60 : 18/60 : 9/60 :1/10` = `[27:18:9:6]/60`

                  = 9 : 6 : 3 : 2.