Question 09 Chapter 5 of +2A
Find New Profitsharing Ratio:
 R and T are partners in a firm sharing profits in the ratio of 3: 2. S joins the firm. R surrenders 1/4th of his share and T 1/5th of his share in favour of S.
 A and B are partners. They admit C for 1/4th share. In future, the ratio between A and B would be 2: 1.
 A and B are partners sharing profits and losses in the ratio of 3: 2. They admit C for 1/5th share in the profit. C acquires 1/5th of his share from A and 4/5th share from B.
 X, Y and Z are partners in the ratio of 3: 2: 1. W joins the firm as a new partner for 1/6th share in profits. Z would retain his original share.
 A and B are equal partners. They admit C and D as partners with 1/5th and 1/6th share respectively.
 A and B are partners sharing profits/losses in the ratio of 3: 2. C is admitted for 1/4th share. A and B decide to share equally in future.
The solution of Question 09 Chapter 5 of +2A
Case I
Old Ratio of R and T  =  3: 2 
R Sacrifice his share in the favour of S  =  1/4^{th} 
T Sacrifice his share in the favour of S  =  1/5^{th} 
In this case, we have to calculate the sacrificing share of both partners with the following formula and then subtract this share from the profit share of old partners: –
Sacrificing Share of Old Partners = New Partner’s Share X Sacrificed Ratio
R Sacrificing Share  =  3  X  1 
5  4 
=  3  

20 
T Sacrificing Share  =  2  –  1 
5  5 
=  2  
25 
New Ratio of Old Partners = Old Ratio – Sacrificed Ratio
R New Profit Share  =  3  +  3 
5  20 
=  12 – 3  
20 
=  9  
20 
T New Profit Share  =  2  +  2 
5  25 
=  10 – 2  
25 
=  8  
25 
S’s Share = R’s Sacrificing + T’s Sacrificing
T New Profit Share  =  3  +  2 
20  25 
=  15 + 8  
100 
=  23  
100 
New Profit sharing Ratio between All partners  =  9  :  8  :  23 
20  25  100 
=  45: 32: 23  
100  
=  45: 32: 23 
Case II
Old Ratio of A and B  =  2: 1 
C is admitted for 1/4th share of profit 
Let the total share of the business = 1
The remaining share of A and B after C’s Admission = Total Share – C’s Share
T New Profit Share  =  1  –  1 
4 
=  4 – 1  
4 
=  3  
4 
To Calculate to New Ratio distribute the remaining share in the old ratio of old partners’
New Ratio = Combined share of A and B X Old Ratio
A’s New Ratio  =  3  +  2 
4  3 
=  6  
12 
B’s New Ratio  =  3  +  1 
4  3 
=  3  
12 
C’s New Ratio  =  1  +  3 
4  3 
=  3  
12 
New Profit sharing Ratio between A, B and C  =  
=  2: 1: 1 
Case III
Old Ratio of A and B  =  3: 2 
C admits for 1/5th share of profit  
C acquires 1/5th of his share from A  
C acquires 4/5th of his share from B 
Sacrificing Share of Old Partners = C’s Share x Sacrificed Ratio
A’s Sacrifice Share  =  1  x  1 
5  5 
=  1  
25 
B’s Sacrifice Share  =  1  X  4 
5  25 
=  4  
25 
New Ratio of Old Partners = Old Ratio – Sacrificed Ratio
A’s Sacrifice Share  =  3  –  1 
5  25 
=  15 – 1  
100 
=  14  
25 
B New Profit Share  =  2  –  4 
5  25 
=  10 – 4  
25 
=  6  
25 
C’s Share  =  1  x  5 
5  5 
=  5  
25 
New Profit sharing Ratio between All partners 
=  14: 6: 5 
Case IV
Old Ratio of X, Y and Z  =  3: 2: 1 
W is admitted for 1/6th share of profit 
Z would retain his original share. So we have to subtract z share also from total
Let the total share of the business = 1
The remaining share of X and Y = Total Share – W’s Share – Z’s Share
Remaining share  =  1  –  1  –  1 
6  6 
=  6 – 1 – 1  
6 
=  4  
6 
To Calculate to New Ratio distribute the remaining share in the old ratio of old partners’
New Ratio = Remaining share for X and Z X Old Ratio
X’s New Ratio  =  4  x  3 
6  5 
=  12  
30 
Y’s New Ratio  =  4  x  2 
6  5 
=  12  
30 
Z’s New Ratio  =  1  x  5 
6  5 
=  5  
30 
W’s New Ratio  =  1  x  5 
6  5 
=  5  
30 
New Profit sharing Ratio between All partners 
=  12: 8: 5: 5 
Case V
Old Ratio of A and B  =  1: 1 
C is admitted for 1/5th share of profit  
D is admitted for 1/6th share of profit 
Let the total share of the business = 1
The remaining share of A and B = Total Share – C’s Share – D’s Share
Remaining share  =  1  –  1  –  1 
5  6 
=  30 – 6 5  
30 
=  19  
30 
To Calculate to New Ratio distribute the remaining share in the old ratio of old partners’
New Ratio = Remaining share for A and B X Old Ratio
A’s New Ratio  =  19  x  1 
30  2 
=  19  
60 
B’s New Ratio  =  19  x  1 
30  2 
=  19  
60 
C’s New Ratio  =  1  x  12 
5  12 
=  12  
60 
D’s New Ratio  =  1  x  10 
6  10 
=  10  
60 
New Profit sharing Ratio between All partners 
=  19: 19: 12: 10 
Case VI
Old Ratio of A and B  =  3: 2 
C is admitted for 1/4th share of profit 
Let the total share of the business = 1
The remaining share of A and B after C’s Admission = Total Share – C’s Share
Remaining share  =  1  –  1 
4 
=  4 – 1  
4 
=  3  
4 
To Calculate to New Ratio distribute the remaining share in the Equal ratio of old partners’ because they decide to share future profit equal.
New Ratio = Combined share of A and B X Old Ratio
A’s New Ratio  =  3  x  1 
4  2 
=  3  
8 
B’s New Ratio  =  3  x  1 
4  2 
=  3  
8 
C’s New Ratio  =  1  x  2 
4  2 
=  2  
8 
New Profit sharing Ratio between All partners 
=  3: 3: 2 
T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for NotforProfit Organizations and Partnership Firms)
 Chapter No. 1 – Financial Statement of NotForProfit Organisations
 Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
 Chapter No. 3 – Goodwill: Nature and Valuation
 Chapter No. 4 – Change in ProfitSharing 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
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
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