A and B start a business investing Rs. 25,000 and Rs. 35,000 respectively. If the annual profit is Rs. 24,000, B's share is:

Question

Ridhima and Kavita were partners sharing profits and losses in the ratio of 3:2. Their fixed capitals were |1,50,000 and |2,00,000 respectively. The partnership deed provides for interest on capital @ 8% p.a. The net profit of the firm for the year ended 31st March, 2023 amounted to |21,000. The amount of interest on capital credited to the capital accounts of Ridhima and Kavita will be:

Answer 1

Step 1: Profit-sharing ratio \(= 25000:35000 = 5:7\); total \(= 12\) parts.
Step 2: B's share \(= \dfrac{7}{12}\times24000 = \text{Rs. }14000\).

Quick Tip: With equal time periods, profit splits in the ratio of the capitals.

A and B start a business investing Rs. 25,000 and Rs. 35,000 respectively. If the annual profit is Rs. 24,000, B's share is:

The Correct Option is A

Solution and Explanation

Top Questions on Partnership

Questions Asked in ATMA exam