Question

Give two differences between Sacrificing Ratio and Gaining Ratio.

Answer 1

	Sacrificing Ratio	Gaining Ratio
Purpose	Sacrificing Ratio is calculated to determine how much of their share in profits existing partners are giving up to accommodate a new partner.	Gaining Ratio is calculated to determine how much extra share in profits continuing partners are gaining from the retiring or deceased partner’s share.
Applied To	Sacrificing Ratio is applicable when there is an admission of a new partner or a change in the profit-sharing ratio.	Gaining Ratio is applicable when a partner retires or passes away, and the remaining partners gain from their share.