A and B are sharing profits and losses equally. With effect from 1st April, 2019, they agree to share profits in the ratio of 4 : 3. Calculate individual partner's gain or sacrifice due to the change in ratio.
Old Ratio (A and B) = 1 : 1
New Ratio (A and B) = 4 : 3
Sacrificing (or Gaining) Ratio = Old Ratio − New Ratio
Chapter 4: Change in Profit-Sharing Ratio Among the Existing Partners Exercise | Q: 1
Solution A And B Are Sharing Profits and Losses Equally. with Effect from 1st April, 2019, They Agree to Share Profits in the Ratio of 4 : 3. Concept: Retirement and Death of a Partner - Sacrificing Ratio.