Sacrificing ratio is differ from new profit sharing ratioa)It is related to old partnersb)It is related to all partnersc)It is related to new partnersd)It is related to all partners (including new)Correct answer is option 'A'. Can you explain this answer?

Question

Answer

Explanation:

Sacrificing Ratio:
- The sacrificing ratio is the ratio in which the old partners give up their share of profit in favor of the new partner.
- It is calculated to determine how much profit the existing partners are willing to forgo in order to accommodate the new partner in the business.
- The sacrificing ratio is only relevant to the old partners as they are the ones making the sacrifice.

New Profit Sharing Ratio:
- The new profit sharing ratio is the ratio in which the profits of the business will be distributed among all partners, both old and new.
- It reflects the agreed upon distribution of profits among all partners after the admission of a new partner.
- The new profit sharing ratio is applicable to all partners, including both old and new partners.

Conclusion:
- In summary, the sacrificing ratio is specific to the old partners who are sacrificing a portion of their profit share to accommodate a new partner, while the new profit sharing ratio applies to all partners, old and new, and determines how profits will be distributed among them.

Answer

Sacrificing ratio is concerned with the old partners who are sacrificing their share in favor of a new partner. New ratio means, new ratio of all the partners (including new and old partners).

Similar Class 12 Doubts

Gain / loss on revaluation at the time of change in profit sharing ratio of existing partners is shared by(i)_ whereas in case of admission of a partner it is shared by(ii)____ .

The amount of goodwill brought in by the new partner is shared by the partners in their ratio

A and B are two partners sharing profit and losses as 3:2 . They admit C as a new partner for 1/5 share of the future profit which he has acquired equally from A and B in the ratio of 2:1 calculate new profit sharing ratio and a sacrificing ratio .

A,B and C are partners sharing profits in the ratio of 8:7:5. D is admitted as a new partner for 1/4th share. B sacrifice 1/10th from his share in favour of D and the remaining sacrifice made by A and C in the ratio 2:1. Calculate sacrificing ratio amd new profit sharing ratio?

A and B are two partners sharing profit and losses in the ratio of 3:2 G is admitted as a new partner for 1/5 share calculate new profit sharing ratio and sacrificing ratio .

Top Courses for Class 12

Suggested Free Tests

Related Content

Schools

Competitive Examinations

Quick Access Links

Technical Exams