Sudhir started a business with Rs. 30,000 and after 8 months Ravi joined him…
2024
Sudhir started a business with Rs. 30,000 and after 8 months Ravi joined him with Rs. 60,000. If, at the end of the year, they earn a profit of Rs. 28,000, then the ratio of their shares will be
- A.
3:2
- B.
2:3
- C.
4:3
- D.
3:4
Show answer & explanation
Correct answer: A
Concept: In a partnership, when partners invest different amounts of capital for different periods, profit is divided in the ratio of each partner's capital multiplied by the number of months that capital remained invested — not by capital alone and not by time alone.
Application:
Sudhir invests Rs. 30,000 and keeps it in the business for the entire 12-month period, so his capital-time product is 30,000 × 12 = 3,60,000.
Ravi joins after 8 months, so his capital of Rs. 60,000 stays invested only for the remaining 12 − 8 = 4 months, giving a capital-time product of 60,000 × 4 = 2,40,000.
The profit-sharing ratio is the ratio of these two capital-time products: 3,60,000 : 2,40,000.
Dividing both terms by their highest common factor, 1,20,000, simplifies the ratio to 3 : 2.
Cross-check: Splitting the given profit of Rs. 28,000 in the ratio 3 : 2 gives Sudhir Rs. 16,800 and Ravi Rs. 11,200; these two shares add up to Rs. 28,000, confirming the ratio is consistent with the total profit.
