If A invests $40,000 and B invests $60,000 in a partnership, and they agree to s

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Question: If A invests $40,000 and B invests $60,000 in a partnership, and they agree to share profits in the ratio of their investments, what will be A\'s share if the total profit is $100,000?

Options:

$40,000
$50,000
$60,000
$30,000

Correct Answer: $50,000

Solution:

Total investment = 40,000 + 60,000 = 100,000. A\'s share = (40,000/100,000) * 100,000 = $40,000.

If A invests $40,000 and B invests $60,000 in a partnership, and they agree to s

Practice Questions

If A invests $40,000 and B invests $60,000 in a partnership, and they agree to share profits in the ratio of their investments, what will be A's share if the total profit is $100,000?

$40,000
$50,000
$60,000
$30,000

Questions & Step-by-Step Solutions

If A invests $40,000 and B invests $60,000 in a partnership, and they agree to share profits in the ratio of their investments, what will be A's share if the total profit is $100,000?

Step 1: Identify the amounts invested by A and B. A invests $40,000 and B invests $60,000.
Step 2: Calculate the total investment by adding A's and B's investments together: 40,000 + 60,000 = 100,000.
Step 3: Determine the ratio of A's investment to the total investment. This is done by dividing A's investment by the total investment: 40,000 / 100,000.
Step 4: Calculate A's share of the total profit by multiplying the ratio from Step 3 by the total profit of $100,000: (40,000 / 100,000) * 100,000.
Step 5: Simplify the calculation from Step 4 to find A's share: A's share = $40,000.

Profit Sharing Ratio – Understanding how to calculate profit shares based on investment ratios.
Proportional Distribution – Applying proportional distribution of profits based on initial investments.

If A invests $40,000 and B invests $60,000 in a partnership, and they agree to s

What’s inside this PDF?

If A invests $40,000 and B invests $60,000 in a partnership, and they agree to s

Practice Questions

Questions & Step-by-Step Solutions

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