Sacrificing ratio in partnership accounting – The ratio in which an existing partner is ready to sacrifice his share of profit to another partner is known as sacrificing ratio.
The formula for sacrificing ratio is :
Sacrificing Ratio = New Ratio – Old ratio
Sacrificing Ratio in Partnership Accounting : Example 1
A , D and K are partners sharing profits and losses in the ratio of 5 : 5 : 2 respectively. A sacrifices of his share and D sacrifices of his share in favour of K .What will be the sacrificing ratio between partners.
Explanation : –
A sacrifices of=
D sacrifices of=
now K s share in profit of the firm =++
A s remaining portion of share =–==
B s remaining portion of share =–==
New profit sharing between partners =::
= 15 : 15 : 18
Sacrificing ratio = Old ratio – New ratio
5 : 5