A is working partner and B is a sleeping partner in a business. A puts in Rs…
2025
A is working partner and B is a sleeping partner in a business. A puts in Rs 5000 and B puts in Rs 6000. A receives 12 1/2 per cent of profit for managing the business and the rest is divided in proportion to their capitals. How much does each get out of a profit of Rs 880 ?
- A.
430 and 540
- B.
460 and 420
- C.
540 and 500
- D.
480 and 460
Attempted by 5 students.
Show answer & explanation
Correct answer: B
When one partner works to manage the business (a working partner) and is entitled to a fixed commission out of the profit, that commission is set aside first from the total profit. The profit that remains after removing the commission is then shared among all partners strictly in the ratio of their capital contributions. Each partner's total gain equals their commission (if any) plus their share of the remaining profit.
Capital ratio: A invests Rs 5000 and B invests Rs 6000, so A : B = 5000 : 6000 = 5 : 6.
A's management commission = 12.5% of the total profit of Rs 880 = (1/8) × 880 = Rs 110.
Profit remaining after the commission = 880 − 110 = Rs 770.
Divide Rs 770 in the capital ratio 5 : 6 — A's share = (5/11) × 770 = Rs 350, and B's share = (6/11) × 770 = Rs 420.
A is the working partner, so A's total gain = commission + capital share = 110 + 350 = Rs 460. B is the sleeping partner (no commission), so B's total gain = Rs 420.
Check: A's Rs 460 plus B's Rs 420 adds up to Rs 880, the full profit — confirming the split is consistent.
