0Lesson Partnership
Sacrificing Ratio
At the time of admission of a Partner, the old partners will sacrifice from their profit sharing ratio. For example , a firm has two partners A and B who were sharing profit equally ( 1:1). They admitted the third partner C. After admission of C they have decided to share profit equally (1:1:1)
Now we can say that in the old firm A and B were sharing profit 1/2 and 1/2
In the new firm partners A, B and C are sharing profit in 1/3, 1/3 and 1/3
Sacrificing ratio is OLD RATIO - NEW RATIO of A and B
Thus in this case sacrificing ratio of A is 1/2-1/3 = 1/6
same method for B 1/2-1/3 = 1/6
The old partners A and B are sacrificing 1/6 and 1/6
As the denominator is same for both, the numerators will be the ratio
Thus sacrificing ratio among A and B is 1:1
