Advertisements
Advertisements
Question
On 1-4-2010 Sahil and Charu entered into a partnership for sharing profits in the ratio of 4: 3. They admitted Tanu as a new partner on 1-4-2012 for `1/5` th share which she acquired equally from Sahil and Charu. Sahil, Charu and Tanu earned profits at a higher rate than the normal rate of return for the year ended 31-3-2013. Therefore, they decided to expand their business. To meet the requirements of additional capital they admitted Puneet as a new partner on 1-4-2013 for `1/7` th share in profits which he acquired from Sahil and Charu in 7: 3 ratio.
Calculate:
1) New profit sharing ratio of Sahil, Charu and Tanu for the year 2012-13.
2) New profit sharing ratio of Sahil, Charu, Tanu and Puneet on Puneet's admission.
Solution
Calculation of New Profit sharing Ratio of Sahil, Charu and Tanu for the year 2012 – 13
Old Ratio of Sahil and Charu = 4:3
Tanu was admitted for 1/5th share, which was acquired by her equally from Sahil and Charu
SacrificingShare
Sahil = `1/5 xx 1/2 = 1/10`
Charu = `1/5 xx 1/2 = 1/10`
New Profit Share = Old Ratio – Sacrificing Share
Sahil = `4/7 - 1/10 = (40 - 7)/70 = 33/70`
Charu = `3/7 - 1/10 = (30 - 7)/70 = 23/70`
Tanu = `1/10 + 1/10 = 2/10 or 14/70`
Therefore, New Profit Sharing Ratio of Sahil, Charu and Tanu = 33:23:14
2) Calculation of New Profit Sharing Ratio of Sahil, Charu, Tanu and Puneet
Old Ratio of Sahil, Charu and Tanu = 33:23:14
Puneet was admitted for 1/7th share, which he acquired from Sahil and Charu in the ratio of 7:3
SacrificingShare
Sahil = `1/7 xx 7/10 = 7/10`
Charu = `1/7 xx 3/10 = 3/70`
New Profit Share = Old Share - Sacrificing Share
Sahil = `33/70 - 7/70 = 26/70`
Charu = `23/70 - 3/70 = 20/70`
Tanu = `14/70`
Puneet = `7/70 + 3/70 = 10/70`
Therefore, New Profit Sharing Ratio of Sahil, Charu Tanu and Puneet = 26:20:14:10
APPEARS IN
RELATED QUESTIONS
The proportion in which old partners make a sacrifice is called ___________ ratio.
Ram, Mohan and Sohan were partners in a firm sharing profits in the ratio of 5:3:2. They admitted Hari as a new partner for 1/5th share in the profit which he acquired from Ram and Mohan in the ratio of 3:2. Calculate the new profit sharing ratio of Ram, Mohan, Sohan and Hari.
On 1.1.2008, Uday and Kaushal entered into a partnership with fixed capitals of Rs 7,00,000 and Rs 3,00,000 respectively. They were doing good business and were interested in its expansion but could not do the same because of lack of capital. Therefore, to have more capital, they admitted Govind as a new partner on 1.1.2010. Govind brought Rs 10,00,000 as capital and the new profit sharing ratio decided was 3:2:5. On 1.1.2012, another new partner Hari was admitted with a capital of Rs 8,00,000 for the 1/10th share in the profits, which he acquired equally from Uday, Kaushal and Govind. On 1.4.2014 Govind died and his share was taken over by Uday and Hari equally. Calculate :
(1) The sacrificing ratio of Uday and Kaushal on Govind's admission.
(2) New profit sharing ratio of Uday. Kaushal, Govind and Had on Hari's admission.
(3) New profit sharing ratio of Uday, Kaushal and Hari on Govind's death.
Anurag and Bhawana entered into the partnership on 1.4.2014. On 1.1.2015 they admitted Monika as a new partner for `3/10` th share in the profits which she acquired equally from Anurag and Bhawana. The new profit sharing ratio of Anurag, Bhawana and Monika was 4:3:3. Calculate the profit sharing ratio of Anurag and Bhawana at the time of forming the partnership.
State the meaning of sacrificing ratio.
Give any one distinction between sacrificing ratio and gaining ratio.
Atal and Madan were partners in a firm sharing profits in the ratio of 5 : 3. On 31.3.2011 they admitted Mehra as a new partner fro 1/5th share in the profits. The new profit sharing ratio was 5 : 3 : 2. On Mehra’s admission the Balance Sheet to the firm was as follows:
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Capitals: |
|
Land and Building |
1,50,000 |
|
|
Atal: |
1,50,000 |
|
Machinery |
40,000 |
|
Madan: |
90,000 |
2,40,000 |
Patents |
5,000 |
|
Provision for bad debts |
1,200 |
Stock |
27,000 |
|
|
Creditors |
20,000 |
Debtors |
47,000 |
|
|
Workmen compensation Fund |
32,000 |
Cash |
4,200 |
|
|
|
|
Profit and Loss Account |
20,000 |
|
|
|
2,93,200 |
|
2,93,200 |
|
|
|
|
|||
On Mehra’s admission it was agreed that
(i) Mehra will bring Rs 40,000 as his capital and Rs 16,000 for his share of goodwill premium, half of which was with draw by Atal and Madan;
(ii) A provision of `2 1/2%` for bad and doubtful debts was to be created;
(iii) Included in the sundry creditors was an item of Rs 2,500 which was not to be paid;
(iv) A provision was to be made for an outstanding bill for electricity Rs 3,000;
(v) A claim of Rs 325 for damage against the firm was likely to be admitted. Provision for the same was to be made.
After the above adjustment, the capitals of Atal and Madan were to be adjusted on the basis of
Mehra’s capital. Actual cash was to be brought in or to be paid off to Atal and Madan as the case may be.
Prepare Revaluation Account, Capital Accounts of the partners and the Balance Sheet of the new firm.
X Ltd has a Current Ratio of 3 : 1 and Quick Ratio of 2 : 1. If the excess of Current Assets over
Quick Assets as represented by Stock is Rs 40,000, calculate Current Assets and Current Liabilities.
Answer in one sentence only.
What is sacrifice ratio?
Answer in one sentence only.
How is sacrifice ratio calculated?
Answer in one sentence only.
When is the ratio of sacrifice to be calculated?
Select the most appropriate answer from the alternative given below and rewrite the sentence.
Krishna and Balram, who are equal partners, admit Arjun into partnership for 1/4th share, their new profit sharing ratio will be ________________.
Select the most appropriate answer from the alternative given below and rewrite the sentence.
In case of admission of a partner, the profit or loss on revaluation of assets and liabilities is shared by _________________ partners.
Asha and Nisha were partners in a firm sharing profits and losses in the ratio 3:1. Charu was admitted as a new partner for 1/4th share in the profits of the firm which she acquired equally from Asha and Nisha. The new profit sharing ratio of Asha, Nisha and Charu will be ______.
Monu and Sonu were partners sharing profits in the ratio of 2 : 3. They admitted Ram as a new partner for `3/5`th share in profits which he acquired `1/5`th from Monu and `2/5`th from Sonu. The new profit sharing ratio of monu, sonu and ram will be ______.
Mini and Mansi are partners sharing profits in the ratio of 4 : 3. They admitted Nisha as a new partner for `3/7`th share in profits which she acquired `2/7`th from Mini and `1/7`th from Mansi. The new profit sharing ratio of Mini, Mansi and Nisha will be ______.
