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Difference between gaining and sacrificing ratio

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Difference between gaining and sacrificing ratio

Posted by Tajik Bamang 6 years, 5 months ago

CBSE > Class 12 > Accountancy

1 answers

Sia ? 6 years, 5 months ago

Basis of Difference	Sacrificing ratio	Gaining Ratio
1. Meaning	It is the ratio in which old partners agree to sacrifice their share of profit in favour of new partners/partner	It is the ratio in which continuing partner acquires the share of profit from outgoing partner/partner
2. Effect	It reduces the profit share of the existing partners.	It increases the profit share of the remaining partners.
3. Objective	It is calculated to ascertain the share of profit and loss given up by the existing partners in favour of new partners/partner.	It is calculated to ascertain the share of profit and loss acquired by the remaining partners (of the new firm in case of retirement) from the retiring or deceased partner.
4. Time	It is calculated at the time of admission of new partners/partner.	It is calculated at the time of retirement/death of old partners/partner.
5. Calculation	Sacrificing Ratio = Old Ratio – New Ratio	Gaining Ratio = New Ratio – Old Ratio

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