Select the most appropriate answer from the alternatives given below :

Gaining ratio is the ratio in which ________________.
a) the old partner gains on admission of a new partner
b) the goodwill of a new partner on admission is credited to old partners
c) the continuing partner’s benefits on retirement or death of a partner
d) none of the above

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Solution

Gaining ratio is the ratio in which the continuing partners benefit on retirement or death of a partner.

Explanation: On the eve of retirement or death, the remaining (continuing) partners acquire the outgoing (retiring or deceased as the case may be) partner’s share. The ratio in which the continuing partners acquire (gain) the outgoing partner’s share is termed as gaining ratio.

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