Question

X and Y are partners sharing profits in 5:3 ratio admitted Z for 1/10 share which he acquired equally for X and Y. Calculate new profit sharing ratio?

Answer 1

Old Ratio = A : B

                = 5 : 3

               = `5/8 : 3/8`

Z admits for  `1/10` share in the new firm.

X and Y each sacrifice = `1/10 xx 1/2 = 1/20`

New Ratio = Old Ratio − Sacrificing Ratio

X's = `5/8 - 1/20`

      = `[25 - 2]/40 = 23/40`

Y's = `3/8 - 1/20`

     = `[ 15 - 2 ]/40 = 13/40`

New Ratio = A : B : C

                 = `23/40 : 13/40 : 1/10`

                = `[ 23 : 13 : 4 ]/40`

               = `23 : 13 : 4`