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Find New Profit-sharing Ratio: A And B Are Partners. They Admit C For 1/4th Share. in Future, the Ratio Between A And B Would Be 2 : 1. - Accountancy

Sum

Find New Profit-sharing Ratio:
A and B are partners. They admit C for 1/4th share. In future, the ratio between A and B would be 2 : 1.

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Solution

Old Ratio = A : B
                = 1 : 1
C admits for `1/4`th share of profit
Let the combined share of A, B and C be = 1
Combined share of A and B = 1 - C's share
= 1 - `1/4` = `3/4`

New Ratio = Combined share of A and B x `2/3`

A's = `3/4 xx 2/3 = 6/12`

B's = `3/4 xx 1/3 = 3/12`

New Profit Sharing Ratio = A : B : C
                                        = `6/12 : 3/12 : 1/4`

                                        = `[ 6 : 3 : 3]/12`

                                        = 2 : 1 : 1

Concept: Retirement and Death of a Partner - Calculation of New Profit Sharing Ratio
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APPEARS IN

TS Grewal Class 12 Accountancy - Double Entry Book Keeping Volume 1
Chapter 5 Admission of a Partner
Exercise | Q 9.2 | Page 86
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