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Question
X, Y and Z are partners sharing profits in the ratio of 1/2, 3/10, and 1/5. Calculate the gaining ratio of remaining partners when Y retires from the firm.
Solution
Calculation of Gaining Ratio
`"Old Ratio" = "X : Y : Z"`
`1/2 : 3/10 : 1/5`
= `(5 : 3 : 2)/10`
New Ratio after Y's retirement = 5 : 2
`"Gaining Share = New Share – Old Share"`
`"X's Gain" = 5/7 - 5/10 = 15/70`
`"Z's Gain" = 2/7 - 2/10 = 6/10`
`"Gaining Ratio" = 15 : 6 or 5 : 2`
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