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A and B enter into partnership with capital contribution of $ 5000 and $ 4000 respectively. After (1 / 6) th of the time A contributes additional $ 2000. Four months after the start B withdraws (1 / 4) th his capital, then C joins the business with a capital investment of $ 5000. At the end of the year the company’s balancesheet shows a profit of $ 2804. Find the share of A in the profit.
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- $ 1402
- $ 701
- $ 1420
- $ 820
Correct Option: A
Computing in terms of 1 month
A’s investment = (5000 × 12) + (2000 × 10) = $ 80000
B’s investment = (4000 × 4) + (3000 × 8) = $ 40000
C’s investment = 5000 × 8 = $ 40000
A : B : C = 80000 : 40000 : 40000
A : B : C = 2 : 1 : 1
Sum of ratios = 2 + 1 + 1 = 4
Profit = $ 2804
| Now, share profit for 1 month = | = $ 701 | 4 |
A’s share = 701 × 2 = $ 1402
