[amp_mcq option1=”08:02:02″ option2=”06:04:03″ option3=”08:03:04″ option4=”04:08:03″ correct=”option3″]
The correct answer is C.
Initially, A and B share the profits in the ratio of 1 : 2. This means that A gets 1 share and B gets 2 shares. When C is admitted, he gets $\frac{1}{5}$ of the share. This means that the new profit sharing ratio will be 1 + $\frac{1}{5}$ : 2 + $\frac{1}{5}$ : $\frac{1}{5}$. This simplifies to 8 : 3 : 4.
Option A is incorrect because it does not take into account the fact that C gets $\frac{1}{5}$ of the share.
Option B is incorrect because it does not take into account the fact that A and B share the profits in the ratio of 1 : 2.
Option D is incorrect because it does not take into account the fact that C gets $\frac{1}{5}$ of the share.