Profit and Loss Easy Questions and Answers | Page - 74

Profit and Loss

A starts an industry with $ 20 lakhs. After 4 months he enters into a partnership with B who contributes $ 40 lakhs. C joins them after another 3 months with a capital of $ 60 lakhs. At the year end, the balance sheet shows a profit of $ 74000. Find the share of A in the profit.

1. $ 32000
1. $ 24000
1. $ 18000
1. $ 16000

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On the basis of given details in question ,
A’s investment is $ 20 lakhs for the whole year i.e., 12 months which is equivalent to 20 × 12 = $ 240 lakhs for 1 month
B’s investment is $ 40 lakhs for (12 – 4) = 8 months is equivalent to 40 × 8 = $ 320 lakhs for 1 month.
C’s investment is $ 60 lakhs for 3 months is equivalent to 60 × 3 = $ 180 lakhs for 1 month
The share in the profit should be in the following ratio,
A : B : C = 240 : 320 : 180 = 12 : 16 : 9
Sum of ratios = 12 + 16 + 9 = 37

Correct Option: B

On the basis of given details in question ,
A’s investment is $ 20 lakhs for the whole year i.e., 12 months which is equivalent to 20 × 12 = $ 240 lakhs for 1 month
B’s investment is $ 40 lakhs for (12 – 4) = 8 months is equivalent to 40 × 8 = $ 320 lakhs for 1 month.
C’s investment is $ 60 lakhs for 3 months is equivalent to 60 × 3 = $ 180 lakhs for 1 month
The share in the profit should be in the following ratio,
A : B : C = 240 : 320 : 180 = 12 : 16 : 9
Sum of ratios = 12 + 16 + 9 = 37
Profit for 1 month = 47000 = $ 2000
37

A’s share = $ (12 × 2000) = 24000

A and B are partners in a firm. A invests $ 15000 and B $ 25000. A is the working partner and gets 20% of the profit for his contribution in the management of the firm. B is the sleeping partner. If the profit is $ 475, find the share of B.

1. $ 237.5
1. $ 257.5
1. $ 247.5
1. $ 238.5

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First we have to deduct the payment to be made to A from the total profit for his contribution in the management of the firm.
20% of Rs. 475 = $ 95
Balance profit = $ (475 – 95) = $ 380.
This has to be divided between
A and B in the ratio of their investments i.e., $ 15000: $ 25000 = 3 : 5

Correct Option: A

First we have to deduct the payment to be made to A from the total profit for his contribution in the management of the firm.
20% of Rs. 475 = $ 95
Balance profit = $ (475 – 95) = $ 380.
This has to be divided between
A and B in the ratio of their investments i.e., $ 15000: $ 25000 = 3 : 5
Sum of ratios = 3 + 5 = 8
B’s share = $ 380 × 5 = $ 273.5
8

A, B and C enter into a partnership. A invests $ 2400 for 4 years, B $ 2800 for 8 years and C $ 2000 for 10 years. They earn $ 1170. Find the share of each.

1. $ 420
1. $ 540
1. $ 108
1. $ 216

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Here , Profit = $ 1170
This is a case of compound partnership.
$ 2400 investment for 4 years earns as much as $ 2400 × 4 = $ 9600 in 1 year
Similarly, $ 2800 for 8 years is equivalent to $ 2800 × 8 = $ 22400 in 1 year
$ 2000 for 10 years is equivalent to $ 2000 × 10 = $ 20,000 in 1 year
The profit is, therefore, divided in the ratio $ 9600 : $ 22400 : $ 20000 or, 12 : 28 : 25
Sum of the ratios =12 + 28 + 25 = 65

Correct Option: D

Here , Profit = $ 1170
This is a case of compound partnership.
$ 2400 investment for 4 years earns as much as $ 2400 × 4 = $ 9600 in 1 year
Similarly, $ 2800 for 8 years is equivalent to $ 2800 × 8 = $ 22400 in 1 year
$ 2000 for 10 years is equivalent to $ 2000 × 10 = $ 20,000 in 1 year
The profit is, therefore, divided in the ratio $ 9600 : $ 22400 : $ 20000 or, 12 : 28 : 25
Sum of the ratios =12 + 28 + 25 = 65
Share of each = $ 1170 = $18
65

So, A’s share =12 × $ 18 = $ 216
B’s share =28 × $ 18 = $ 504
C’s share =25 × $ 18 = $ 450

A, B and C invest $ 1000, $ 4000 and $ 5000 respectively in a business. At the end of the year the balance sheet shows a loss of 20% of the total initial investment. Find the share of loss of B.

1. $ 1000
1. $ 200
1. $ 800
1. $ 1200

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As per the given question ,
Total initial investment = $ 1000 + $ 4000 + $ 5000 = $ 10,000
Total loss = 20% of total initial investment
Total loss = 20 × 10,000 = $ 2000
100

(This is an example of simple partnership.)
∴ $ 2000 has to be divided among the partners in proportion to their investments.
Ratio of investments are A : B : C = $ 1000 : $ 4000 : $ 5000 = 1 : 4 : 5
Sum of the ratios = 1 + 4 + 5 = 10

Correct Option: C

As per the given question ,
Total initial investment = $ 1000 + $ 4000 + $ 5000 = $ 10,000
Total loss = 20% of total initial investment
Total loss = 20 × 10,000 = $ 2000
100

(This is an example of simple partnership.)
∴ $ 2000 has to be divided among the partners in proportion to their investments.
Ratio of investments are A : B : C = $ 1000 : $ 4000 : $ 5000 = 1 : 4 : 5
Sum of the ratios = 1 + 4 + 5 = 10
1 ⇒ $ 2000 = $ 200
10

Share of loss for B = 4 × $ 200 = $ 800

$ 52000 is to be divided among the partners A, B and C. The ratio of their investments is (1 / 12) : (1 / 18) : (1 / 24). Find the share of A.

1. $ 16000
1. $ 24000
1. $ 12000
1. $ 18000

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This is a case of simple partnership :
Ratio of their investments = 1 :
1 :
1 = 6 :
4 :
3
12 18 24 72 72 72

(Here , 72 is the LCM of 12, 18 and 24)
Ratio of their investments = 6 : 4 : 3

Correct Option: B

This is a case of simple partnership :
Ratio of their investments = 1 :
1 :
1 = 6 :
4 :
3
12 18 24 72 72 72

(Here , 72 is the LCM of 12, 18 and 24)
Ratio of their investments = 6 : 4 : 3
Sum of the ratios= 6 + 4 + 3 = 13
and, 52000 = $ 4000
13

A’s share = 6 × 4000 = $ 24000