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Question
The sacrificing ratio is to be worked out by _________ each partner's new share from his old share.
The sacrificing ratio is to be worked out by _________ each partner's new share from his old share.
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Solution
The correct option is B deducting
The amount shared by the existing partners in the ratio in which they forego their shares in favour of the new partner is called sacrificing ratio. The ratio is normally given as agreed among the partners which could be the old ratio, equal sacrifice, or a specified ratio. The difficulty arises where the ratio in which the new partner acquires his share from the old partners is not specified. Instead, the new profit sharing ratio is given. In such a situation, the sacrificing ratio is to be worked out by deducting each partner's new share from his old share.
The amount shared by the existing partners in the ratio in which they forego their shares in favour of the new partner is called sacrificing ratio. The ratio is normally given as agreed among the partners which could be the old ratio, equal sacrifice, or a specified ratio. The difficulty arises where the ratio in which the new partner acquires his share from the old partners is not specified. Instead, the new profit sharing ratio is given. In such a situation, the sacrificing ratio is to be worked out by deducting each partner's new share from his old share.
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