Question

X, Y and Z are sharing profits and losses in the ratio of 5 : 3 : 2. With effect from 1st April, 2019, they decide to share profits and losses in the ratio of 5 : 2 : 3. Calculate each partner's gain or sacrifice due to the change in ratio.

Answer 1

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

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

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

X's share = `5/10 - 5/10 = "Nil"`

Y's share = `3/10 - 2/10 = 1/10` (sacrifice)

Z's share = `2/10 - 3/10 = (-1)/10` (gain)

∴ Z’s Gain = 1/10

Y’s Sacrifice = 1/10