12th Class Accountancy Change in Profit Sharing Ratio Among Existing Partner Question Bank MCQs - Reconstitution Of a Partnership Firm : Change in Profit Sharing Ratio

Raju and Gaurav were partners in a firm sharing profits and losses in the ratio of 2 : 1. With effect from 1st January, 2020, they decided to share profits and losses equally. Individual partner's gain or sacrifice due to change in the ratio will be:

A) Gain by Raju 1/6, Sacrifice by Gaurav 1/6

B) Sacrifice by Raju 1/6, Gain by Gaurav 1/6

C) Gain by by Raju 1/2, Sacrifice by Gaurav 1/2

D) Sacrifice by Raju 1/2, Gain by Gaurav 1/2

Correct Answer: B

Solution :

[b] Sacrifice by Raju 1/6, Gain by Gaurav 1/6

Hint: Sacrificing/(Gaining) Share = Old Share-New Share

Raju= \[\frac{2}{3}-\frac{1}{2}=\frac{4-3}{6}=\frac{1}{6}\] Sacrifice

Gaurav= \[\frac{1}{3}-\frac{1}{2}=\frac{2-3}{6}=\left( \frac{1}{6} \right)\]Gain