Partnership Profit Sharing Calculation
The profit in a partnership is distributed based on the ratio of the product of the capital invested and the duration for which it was invested.
Investment Details
- Partner A: Invested ₹15,000 for the entire year (12 months).
- Partner B: Invested ₹20,000 after 2 months, meaning for 10 months (12 - 2 = 10 months).
Calculate Investment Products
We calculate the product of capital and time for each partner:
- A's Investment Product: $15000 \times 12 = 180000$
- B's Investment Product: $20000 \times 10 = 200000$
Determine Profit Ratio
The ratio in which the profit is divided is the ratio of their investment products:
Ratio (A : B) = A's Investment Product : B's Investment Product
Ratio (A : B) = $180000 : 200000$
Simplify the Ratio
Simplify the ratio by dividing both sides by their greatest common divisor (which is 20000):
Ratio (A : B) = $\frac{180000}{20000} : \frac{200000}{20000}$
Ratio (A : B) = $9 : 10$
Therefore, the profit is divided between A and B in the ratio $9 : 10$.
Similar Questions
- P, Q and R started a business investing amounts of ₹2,030, ₹1,700, and ₹1,010, respectively. If Q's share in the profit earned by them is ₹975. what is the difference in the profit (in ₹) earned by P and R?
- Ritu, Sameer, and Isha invest ₹1,190, ₹1,060, and ₹1,350, respectively, to start a business. If the profit at the end of the year is ₹1,640, then what is the share of Isha in the profit?
- Salman and Vivek together invested ₹33,900 in a business. At the end of the year, out of a total profit of ₹10,000, Vivek's share was ₹3,700. What was the difference between their investments?
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- A, B and C divided the profit in the ratio of 3 : 4 : 5. If their total investment is ₹1,44,000, then B's investment will be:
- Anshuman and Kunal together invested ₹36,400 in a business. At the end of the year, out of a total profit of ₹19,500, Kunal's share was ₹6,300. What was the difference between their investments?
- A company earns a profit (in ₹) that is distributed among the company's three partners in the ratio of 14 : 10 : 16. If the difference between the smallest and the largest shares is ₹29,547, the total profit (in ₹) of the company is:
- M and N started a business. M invested ₹48,000 more than N for 3 months, while N invested for 4 months. M's share is ₹498 more than that of N, out of a total profit of ₹1,494. Find the capital contributed by M.
- M and N start a business. M invests ₹24,000 more than N for 3 months and N invests for 4 months. M's share is ₹962 more than that of N, out of a total profit of ₹7,696. Find the capital contributed by M.
- P, Q and R invest a sum in the ratio of 59 : 14 : 72, respectively. If they earned a total profit of ₹4,790 at the end of the year, what is the difference between the shares of Q and R?
Important Questions from Partnership
Kiran, Vimal and Naveen started a business by investing Rs. 1,35,000, Rs. 1,50,000 and Rs. 1,65,000 respectively. Find the share of each (respectively), out of an annual profit of Rs. 60,000.
When the incoming partner cannot bring premium for goodwill, then the necessary adjustment for goodwill is done through which one of the following?
A, B, C invest Rs. 20000, Rs. 30000, Rs. 40000 in a business. After one year, A withdrew his money but B and C continued for one more year. If the net profit after 2 years be Rs. 32000, then A’s share in the profit is:
Manoj received Rs. 6000 as his share out of the total profit of Rs. 9000 which he and Ramesh earned at the end of one year. If Manoj invested Rs. 20000 for 6 months, whereas Ramesh invested his amount for the whole year, what was the amount invested by Ramesh?
Three friends A, B, and C invested Rs. 20,000, Rs. 18,000, and Rs. 14,000, respectively in a business. If at the end of the year they got a profit of Rs. 7,800, then the profit share of B would be:
