Mandla and Nduna are in partnership and they share profits and losses in the rat

Question

Mandla and Nduna are in partnership and they share profits and losses in the ratio of 3:2, respectively. They decided to admit Msholozi as a partner and a 20% interest in the partnership was sold to him. Mandla and Nduna relinquished Msholozi’s interest to him in the proportion of 2:1, respectively. Which one of the following alternatives indicates the correct new profit-sharing ratio?

1. Mandla, Nduna and Msholozi’s new profit-sharing ratio is 3:2:1, respectively
2. Mandla, Nduna and Msholozi’s new profit-sharing ratio is 3:4:3, respectively
3. Mandla, Nduna and Msholozi’s new profit-sharing ratio is 7:5:3, respectively
4. Mandla, Nduna and Msholozi’s new profit-sharing ratio is 8:4:3, respectively

Explanation / Answer

The Answer is "3"

3. Ratio is 7:5:3.

Calculation of Profit Sharing Ratio :-

= Old Ratio - Sacrificeing Ratio

Mandia = (3/5) - (2/15)

= (9 - 2) / 15

= 7/15

Nduna = (2/5) - (1/15)

= (6 - 1)/15

= 5/15

Msholozi's = (1/5) * (3/3)

= 3/15

New Profit Sharing Ratio is 7 : 5 : 3

Sacrificing Ratio of Mandla = (2/3)*(1/5) = 2/15

Sacrificing Ratio of Nduna = (1/3)*(1/5) = 1/15

* 1/5 = 20% *

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