Question

A, B & C partners in a firm sharing profits losses in the ratio of 4:3:2. B decided to retire from the firm. Calculate the new profit sharing ratio of A & C if B gives his share to A & C in the original ratio of A & C.

• A. 7:2
• B. 25:11
• C. 11:7
• D. 2:1

Answer 1

The correct option is D 2:1

Old ratio ( A, B and C ) = 4 : 3 : 2

B;s share = 3/9

Share of B taken by A = (3/9) * (4/6) = 2/9

Share of B taken by C = (3/9) * (2/6) = 1/9

New ratio = old ratio + share taken from B

A's new share = (4/9) + (2/9) = (6/9) or (2/3)

C's new share = (2/9) + (1/9) = (3/9) or (1/3)

Therefore, new share of A and C = 2 : 1