Question

Complete the following sentence.

"The ratio in which the old partners agree to sacrifice their share of profit in favour of the incoming partner is ______"

Options

• New profit ratio

• Old profit-sharing ratio

• Sacrificing ratio

• None of the above

Answer 1

"The ratio in which the old partners agree to sacrifice their share of profit in favour of the incoming partner is Sacrificing ratio".

Explanation:

"The Sacrificing ratio is the ratio in which the old partners agree to give up their share of profit in favour of the new partner."

The sacrifice by a partner is equal to the Old Share of Profit - New Share of Profit.