Question

Find New Profit-sharing Ratio:
R and T are partners in a firm sharing profits in the ratio of 3 : 2. S joins the firm. R surrenders 1/4th of his share and T 1/5th of his share in favour of S.

Answer 1

Old Ratio = R : T
               = 3 : 2
Sacrificing Ratio = Old Ratio x Surrender Ratio
R's = `3/5 xx 1/4 = 3/20`

T's = `2/5 xx 1/5 = 2/25`

New Ratio = Old Ratio - Sacrificing Ratio
 R's = `3/5 - 3/20 = 9/20`

T's = `2/5 - 2/25 = 8/25`

S’s Share = R’s Sacrifice + S’s Sacrifice = `3/20 + 2/25 = 23/100`

New Profit Sharing Ratio = R : T : S
                                         = `9/20 : 8/25 : 23/100`

                                        = `[ 45 : 32 : 23 ]/100`

                                        = 45 : 32 : 23.