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R, S and M are partners sharing profits in the ratio of 2/5, 2/5 and 1/5. M decides to retire from the business and his share is taken by R and S in the ratio of 1 : 2. Calculate the new profit-sharing ratio. |
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Answer» profit-sharing ratio is CALCULATED below:EXPLANATION:Old Ratio R, S and M=2: 2: 1M's Profit share After M RETIRED from the firm, his share that was taken by R and S = 1: 2M's Share taken by R M's Share taken by S New Ratio = Old Ratio + M's Share taken by New Profit (R and S) =7: 8Thus, the new profit-sharing ratio of R and S will be 7 : 8. |
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