Rao and Swami are partners in a firm sharing profits and losses in 3:2 ratio. They admit Ravi as a new partner for 1/8 share in the profits. The new profit sharing ratio between Rao and Swami is 4:3. Calculate new profit sharing ratio and sacrificing ratio?
Ravi admits for share of profit in the new firm.
Let the New Firm Profit = 1
Combined share of Rao and Swami in the new firm
= 1 − Ravi’s share of profit
= 1 −
New Ratio = Combined Share of Rao and Swami × Proportion of Rao and Swami in the combined share
Sacrificing Ratio = Old Ratio − New Ratio