Question 03 Chapter 6 of +2-A
Table of Contents
03. 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.
The solution of Question 03 Chapter 6 of +2-A: –
a
Old Ratio R ,S and M = 2 : 2 : 1
M retires from the firm.
| His profit share | = | 1 |
| 5 |
M’s share taken by R and S in ratio of 1 : 2
| Share taken by R | = | 1 | X | 1 |
| 5 | 3 |
| = | 1 | |
| 15 |
| Share taken by S | = | 1 | X | 2 |
| 5 | 3 |
| = | 2 | |
| 15 |
New Ratio = Old Ratio + Share acquired from M
| R’s New Share | = | 2 | + | 1 |
| 5 | 15 |
| = | 6 + 1 | |
| 15 |
| = | 7 | |
| 15 |
| S’s New Share | = | 2 | + | 2 |
| 5 | 15 |
| = | 6 + 2 | |
| 15 |
| = | 8 | |
| 15 |
∴ New Profit Ratio R and S = 7 : 8
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)
- Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
- Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
- Chapter No. 3 – Goodwill: Nature and Valuation
- Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
- Chapter No. 5 – Admission of a Partner
- Chapter No. 6 – Retirement/Death of a Partner
- Chapter No. 7 – Dissolution of a Partnership Firm
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 8 – Company Accounts – Accounting for Share Capital
- Chapter No. 9 – Company Accounts – Issue of Debentures
- Chapter No. 10 – Redemption of Debentures
T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)
- Chapter No. 1 – Financial Statements of a Company
- Chapter No. 2 – Financial Statement Analysis
- Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
- Chapter No. 4 – Accounting Ratios
- Chapter No. 5 – Cash Flow Statement
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