Question

A, B and C were partners in a firm sharing profits in 3 : 2 : 1 ratio. They admitted D for 10% profits. Calculate the new profit sharing ratio.

Answer 1

Existing profit sharing ratio of A, B and C is 3 : 2 : 1

D's share = 10% or $\frac{1}{10}$

Let Total share = 1

Remaining share of A, B and C = $1-\frac{1}{10}=\frac{9}{10}$

A's new share =$\frac{9}{10}\times \frac{3}{6}=\frac{27}{60}$

B's new share = $\frac{9}{10}\times \frac{2}{6}=\frac{18}{60}$

C's new share = $\frac{9}{10}\times \frac{1}{6}=\frac{9}{60}$

New profit sharing ratio of A : B : C : D

$\frac{27}{60}:\frac{18}{60}:\frac{9}{60}:\frac{1}{10}$

or $\frac{27}{60}:\frac{18}{60}:\frac{9}{60}:\frac{6}{60}$

or 27 18 : 9 : 6

or 9 : 6 : 3 : 2