Change in Profit Sharing Ratio

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10 02, 2016

Change in Profit Sharing Ratio

Change in profit sharing ratio of partners involve sacrifice or gain made by the partners, where the total of sacrifice must be equal to total of gain.
10 02, 2016

Calculation of New Profit Sharing Ratio

There is change in the profit sharing ratio of the existing partners also, depending on the partnership agreement.
10 02, 2016

Sacrifice Ratio

It is the ratio in which the old partners sacrifice their share in favor of a new partner. Sacrificing ratio = Old Profit sharing ratio - New Profit sharing ratio [Sacrifice=old share-new share]
10 02, 2016

Gaining Ratio

This is the ratio of share acquired by the remaining partners, from the retiring partner.Gaining ratio = New Profit sharing ratio - Old Profit sharing ratio [Gain=New share-Old share]
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