Q.No.4 | Chapter 4 – Change in Profit-Sharing Ratio Among the Exiting Partners | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1 | Tutorstips
Q.No.4 | Chapter 4 – Change in Profit-Sharing Ratio Among the Exiting Partners | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1
By Sarbjit Singh (B.Com and M.Com)|Published: 9 September 2020|Last Updated: 23 June 2026|T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1Chapter No. 4 – Change in Profit-Sharing Ratio Among the Exiting Partners
Focus Topic:Q.No.4 | Chapter 4 – Change in Profit-Sharing Ratio Among the Exiting Partners | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1
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Question 04 Chapter 4 of +2-A
4. A, B and C are partners sharing profits and losses in the ratio of 5 : 4 : 1. Calculate new profit-sharing ratio, sacrificing ratio and gaining ratio in each of the following cases: Case 1. C acquires 1/5th share from A. Case 2. C acquires 1/5th share equally form A and B. Case 3. A, B and C will share future profits and losses equally. Case 4. C acquires 1/10th share of A and 1/2 share of B.
The solution of Question 04 Chapter 4 of +2-A:
Case I C acquires 1/5th from A
Old Ratio of A,B, & C
=
5 : 4 : 1
A sacrifice 1/5th share of Profit C gain 1/5th share of Profit Calculate the A, B, & C New Profit sharing ratio: - Partner’s New Profit share = Old Ratio − or + Sacrifice/gain
A’s New Share
=
5
-
1
10
5
=
15 -2
10
=
3
30
B’s New Share
=
4
No change
10
C’s New Share
=
1
-
1
10
5
=
6 - 2
10
=
3
10
New Profit Ratio of A,B, & C = 3 : 4 : 3
Case II C acquires 1/5th share equally from A and B.
Old Ratio of A,B, & C = 5 : 4 : 1 A sacrifice 1/10th share of Profit B sacrifice 1/10th share of Profit C gain 1/5th share of Profit Calculate the A, B, & C New Profit sharing ratio: - Partner’s New Profit share = Old Ratio − or + Sacrifice/gain
A’s New Share
=
5
-
1
10
10
=
5 -1
10
=
4
10
B’s New Share
=
4
-
1
10
10
=
4 -1
10
=
3
10
B’s New Share
=
1
+
1
+
1
10
10
10
=
1+1+1
10
=
3
10
New Profit Ratio of A,B, & C = 4 : 3 : 3
Case III A, B and C will share future profits and losses equally.
Old Ratio of A, B, & C = 5 : 4 : 1 New Ratio of A, B, & C = 1 : 1 : 1 Calculate the Sacrificing or Gaining Ratio of Partners Sacrificing or Gaining Ratio= Old Ratio - New Ratio
A’s New Share
=
5
-
1
10
3
=
15 -10
30
=
5
Sacrificing
10
B’s Share Sacrificing/Gaining
=
4
-
1
10
3
=
12 -10
30
=
2
Sacrificing
10
B’s Share Sacrificing/Gaining
=
1
-
1
10
3
=
3-10
30
=
- 7
Gaining
10
Sacrificing Share of A
=
5
30
Sacrificing Share of B
=
2
30
Gaining Share of C
=
-7
30
Case IV C acquires 1/10th share of A and 1/2 share of B.
Old Ratio of A,B, & C= 5 : 4 : 1 A sacrifice 1/10th of his share B sacrifice 1/2th of his share Calculate the A, B, & C New Profit sharing ratio: - Partner’s Sacrifice fixed portion of him share = Old Ratio X Sacrificed portion
A’s New Share
=
5
X
1
10
3
=
1
Sacrificing
20
B’s Sacrifice to C
=
4
X
1
10
3
=
4
Sacrificing
20
B’s Sacrifice to C
=
4
+
1
20
20
=
1 + 4
30
=
5
Gaining
20
Partner’s New Profit share = Old Ratio − or + Sacrifice/gain
A’s New Share
=
5
-
1
10
20
=
10 - 4
20
=
9
20
B’s New Share
=
4
-
4
10
20
=
8 - 4
20
=
4
20
C’s New Share
=
1
+
1
+
4
10
20
20
=
2 + 1 + 4
20
=
7
20
New Profit Ratio of A, B, & C = 9 : 4 : 7
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms
👤
Author & Educator
Sarbjit SinghB.Com and M.Com
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
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