and are partners sharing profits in the ratio of . is admitted for a share of profits, bringing as capital. After all adjustments related to goodwill, revaluation of assets, and reassessment of liabilities, the adjusted capitals of and are and respectively. It is agreed that the partners' capitals should be arranged in proportion to the new profit-sharing ratio. Determine the required new capital of partner .
- ARs. 20,000
- BRs. 40,000
- CRs. 80,000
- DRs. 45,000
Solution & Step-by-step Explanation
Let's calculate the total capital of the firm based on the new partner's capital contribution:\begin{itemize}\item 's share \item 's Capital contribution \item \text{Total Capital of the Firm} $
\end{itemize}Now, let's find the new profit-sharing ratio:\begin{itemize}\item Remaining Share = 1 - \frac{1}{4} = \frac{3}{4} A = \frac{2}{3} \times \frac{3}{4} = \frac{2}{4} B = \frac{1}{3} \times \frac{3}{4} = \frac{1}{4} A:B:C = \frac{2}{4} : \frac{1}{4} : \frac{1}{4} = 2:1:1\end{itemize}Using the total capital and individual ratios, we compute the new required capital for B $
\end{itemize}Now, let's find the new profit-sharing ratio:\begin{itemize}\item Remaining Share = 1 - \frac{1}{4} = \frac{3}{4} A = \frac{2}{3} \times \frac{3}{4} = \frac{2}{4} B = \frac{1}{3} \times \frac{3}{4} = \frac{1}{4} A:B:C = \frac{2}{4} : \frac{1}{4} : \frac{1}{4} = 2:1:1\end{itemize}Using the total capital and individual ratios, we compute the new required capital for B $