1. Ram and Shyam form a partnership (with Shyam as working partner) and start a business by
investing 4000 and 6000 respectively. The conditions of partnership were as follows:
1. In case of profits till 200,00 per annum, profits would be shared in the radio of the invested capital.
2.Profits from 200,001 till 400,000 Shyam would take 20% out of the profit, before the division of remaining profits, which will then be based on ratio of invested capital.
3.Profits in excess of 400,000, Shyam would take 35% out of the profits beyond 400,000, before the division of remaining profits, which will then be based on ratio of invested capital.
If Shyam’s share in a particular year was 367000, which option indicates the total business
profit (in ) for that year?
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By: anil on 05 May 2019 02.37 am
Ratio of profits earned by Ram : Shyam = 4000 : 6000 = 2 : 3 If profit < 2,00,000 % of profit earned by Shyam = $$frac{3}{5} imes$$ 100 = 60% If 2,00,000 < profit < 4,00,000, he gets 20 % and 60 % of the remaining profit. % of profit earned by Shyam = 20% + .80 $$ imes$$ 60% = 68% If profit > 4,00,000 % of profit earned by Shyam = 35 % + .65 $$ imes$$ 60% = 74% Now, for first 2,00,000 profit earned by Shyam = $$frac{60}{100} imes$$ 2,00,000 = Rs. 1,20,000 For second 2,00,000 profit earned by Shyam = $$frac{68}{100} imes$$ 2,00,000 = Rs. 1,36,000 Let total profit earned by them = Rs. (4,00,000 + $$x$$) => From $$Rs. x$$ profit, Shyam received = 3,67,000 - 1,20,000 - 1,36,000 = Rs. 1,11,000 => $$frac{74}{100} imes x$$ = 1,11,000 => $$x$$ = 1,11,000 $$ imes frac{100}{74}$$ = 1,50,000 $$ herefore$$ Total profit = 4,00,000 + 1,50,000 = Rs. 5,50,000
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