1.

X and Y were partners sharing profits in the ratio of 3 : 2. They admitted P and Q as new partners X surrendered 1/3rd of his share in favour of P and Y surrendered 1/4th of his share in favour of Q. Calculate new profit-sharing ratio of X, Y , P and Q.

Answer»

Profit sharing refers to various incentive plans introduced by businesses that PROVIDE direct or indirect PAYMENTS to employees that depend on COMPANY's PROFITABILITY in ADDITION to employees' regular salary and bonuses. In publicly traded companies these plans typically amount to allocation of shares to employees.



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