In this I have a problem
Solution:
Case 1.
Case 1.
Calculation of new profit sharing ratio:
A's new ratio= old ratio-sacrificing ratio
= 5/10-1/5
= 3/10
B's ratio= 4/10
C's new ratio= 1/10+1/5
= 3/10
New profit sharing ratio of A:B:C = 3:4:3
Calculation of sacrificing ratio:
A's sacrifice= 1/5
C's gain= 1/5
(Case 2 ) Calculation of New Profit Sharing Ratio, Sacrificing Share & Gaining Share
Old Profit Sharing Ratio of A:B:C = 5:4:1
A's Sacrifice = 1/5 * 1/2 = 1/10
B's Sacrifice = 1/5 * 1/2 = 1/10
C's Gain = A's Sacrifice + B's Sacrifice
= 1/10 + 1/10 = 2/10
A's New Share = Old Share - Sacrifice = 5/10 - 1/10 = 4/10
B's New Share = Old Share - Sacrifice = 4/10 - 1/10 = 3/10
C's New Share = Old Share + Gain = 1/10 + 2/10 = 3/10
New Profit Sharing Ratio of A:B:C = 4:3:3
Sacrificing Share of A =1/10
Sacrificing Share of B=1/10
Gaining Share of C = 2/10
The solutions to your case 1 and case 2 have been provided above.
The solutions to your case 1 and case 2 have been provided above.
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