Calculation of remuneration & profits to partners

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 July 2014 New partners are admitted to a Partnership Firm on 1.11.2013. How to distribute remuneration and profits between the old and new partners?

CA Parul Saxena

CA Parul Saxena (Expert)
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22 July 2014 calculate the new ration according to capital and time.Say Mr.A and Mr.B starts a business on 01.04.13 with a capital of Rs.100000 and Rs.80000 respectively.Mr.C came on 01.11.13 with a capital of Rs.40000 then the ration will be:-
A=100000*12=1200000
B=80000*12=960000
C=40000*5=200000
New ration=1200000:960000:200000
=120:96:20
=30:24:5
New ratio=30:24:5
Say Profit is Rs.590000
A's share=590000*30/59=300000
B's Share=590000*24/59=240000
C's Share=590000*5/59=50000