Question : Choose which of the following statements is correct in relation with gaining ratio.
Option 1: Gaining Ratio is the ratio in which one or more partners gain profit share(s) as a result of sacrificed profit share(s) by one or more partners of the firm.
Option 2: Gained Profit Share = New Profit Share - Old Profit Share
Option 3: Both 1 and 2
Option 4: None of the above
Correct Answer: Both 1 and 2
Solution : Answer = Both 1 and 2
The gaining ratio refers to the ratio in which one or more partners gain profit shares as a result of other partners sacrificing their profit shares. The gained profit share can be calculated by subtracting the old profit share from the new profit share. Therefore, both statements A and B are accurate.
Hence, the correct option is 3.
