Question

A, B and C are partners in the ratio of $3:2:1$. W is admitted with a $1/6$th share in profits. C would retain his original share. The new profit sharing ratio will be ______.

• A. $8:12:5:5$
• B. $10:6:4:4$
• C. $12:8:5:5$
• D. None of these

Answer 1

The correct option is C $12:8:5:5$

Old ratio (A, B and C) = 3 : 2 : 1

W is admitted for 1/6th share

A's contribution in favour of W = 3/30 (note 1)

B's contribution in favour of W = 2/30 (note 1)

New ratio = Old ratio - Sacrificing ratio

A's new share = (3/6) - (3/30) = 12/30

B's new share = (2/6) - (2/30) = 8/30

C's share = 1/6 or 5/30 (it remains unchanged)

W's share = 1/6 or 5/30

Therefore, new profit sharing ratio of A, B C and W is 12 : 8 : 5 : 5

Notes:

1. In silent question, A and B will contribute in favour of in old ratio.