Accounting JAMB

Ade retires and the remaining partners decide to take Ade’s share in the existing ratio. What is the new ratio?

Ade, Tony, Rose share profit and losses in the ratio of 3 : 2 : 1 respectively. Ade retires and the remaining partners decide to take Ade’s share in the existing ratio. What is the new ratio?

A. 1 : 1
B. 3 : 6
C. 2 : 1
D. 2 : 6

Correct Answer:

Option C = 2 : 1

Explanation

The existing ratio between Tony and Rose = 2/6 and 1/6

Ade’s ratio = 3/6

Ade’s share to be taken by Tony and Rose in the ratio 2 : 1

Tony gets: 3/6 x 2/6

= 6/18

Rose gets: 3/6 x 1/3

= 3/18

New ratio between Tony and Rose = 6 : 3

= 2 : 1

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