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]

It is very interesting to note that in the above case, if the answer is in negative, the result is Gain. It is not always necessary that all the old partners sacrifice; one or some partners can gain also on admission of a new partner. The condition is that the total sacrifice should be equal to the total of gain and the share of the new partner.

Gaining Ratio

Check for More Posts in This Category