X and Y invested in a business. They earned some profit which they divided in…
2024
X and Y invested in a business. They earned some profit which they divided in the ratio of 2 : 3. If X invested Rs. 40,000, the amount invested by Y is :
- A.
Rs. 20000
- B.
Rs. 40000
- C.
Rs. 60000
- D.
Rs. 80000
Show answer & explanation
Correct answer: C
When two partners invest for the same length of time, their profit-sharing ratio is the same as their investment ratio — the share of profit each partner draws is directly proportional to the capital they contributed.
The profit-sharing ratio of X and Y is given as 2 : 3, so their investment ratio is also 2 : 3.
Let Y's investment be Rs. y. Then 40,000 : y = 2 : 3.
Cross-multiplying: 2 × y = 40,000 × 3 = 1,20,000.
So y = 1,20,000 ÷ 2 = 60,000.
Cross-check: 40,000 : 60,000 simplifies to 2 : 3, matching the given profit ratio, so Y invested Rs. 60,000.