Question

State True or False with reason.

The gain ratio is calculated at the time of admission of a partner.

Options

• True

• False

Answer 1

This statement is False.

Reason:

At the time of admission of a person, in the business, sacrifices are made by the old partners in favour of a new partner. It means there is no question of any gain to the partners, so we can say that Gain ratio is not calculated at the time of admission of a partner.