Question : The retiring partner receives payment for giving up a portion of the company's future revenues in favour of the remaining partners. The remaining partners provide such compensation amount in the following ways -
Option 1: Gaining Ratio
Option 2: Sacrificing Ratio
Option 3: Capital Ratio
Option 4: Profit Sharing Ratio
Answer (1)
23rd Jan, 2024
Correct Answer: Gaining Ratio
Solution : Retiring Partners are compensated in a gaining ratio by the surviving partners for giving up a portion of the firm's future profit in favour of the remaining partner.
Hence the correct answer is option 1 .
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