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Question
X,Y and Z are partners sharing profits and losses in the ratio of 5 : 3 : 2. They admit A into partnership and give him 1/5th share of profits. Find the new profit-sharing ratio.
Solution
Old Ratio = X : Y : Z
= 5 : 3 : 2
A is admitted for `1/5` share of profit
Let the combined share of profit for all partners after A's admission be = 1
Combined share of X,Y and Z after A's admission = 1 - A's share
= 1 - `1/5`
= `4/5`
New Ratio = Old Ratio × Combined share of X, Y and Z
X's = `5/10 xx 4/5 = 20/50`
Y's = `3/10 xx 4/5 = 12/50`
Z's = `2/10 xx 4/5 = 8/50`
New Profit Sharing Ratio = X : Y : Z : A
= `20/50 : 12/50 : 8/50 : 1/5`
= `[ 20 : 12 : 8 : 10]/50`
= 10 : 6 : 4 : 5
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Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
|||
| Sundry Creditors |
13,800 |
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|
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| Z |
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Plant and Machinery |
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||
|
|
|
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|
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₹ |
Assets |
₹ |
||
|
Creditors |
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|
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|
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65,000 |
|||
|
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||||
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|
Liabilities |
Amount (₹) |
Assets |
Amount |
||
|
Creditors |
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||
|
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||
|
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|
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50,000 |
||||
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|
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|
Liabilities |
Amount (₹) |
Assets |
Amount (₹) |
||
|
Creditors |
2,00,000 |
Building |
2,00,000 |
||
|
Employees' Provident Fund |
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3,00,000 |
||
|
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|
Capital A/cs: |
Debtors | 80,000 | |||
| X |
3,00,000 |
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| Z |
1,50,000 |
7,00,000 |
|||
|
11,00,000 |
11,00,000 |
||||
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| Year | 2014-15 | 2015-16 | 2016-17 | 2017-18 |
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| Liabilities | Amount (₹) |
Assets | Amount (₹) |
||
| X's Capital A/c | 2,40,000 |
Machinery |
2,40,000 | ||
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|
Z's Capital A/c |
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Assets | Amount (₹) |
||
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