If A invests $40,000 and B invests $60,000 in a business, and they earn a profit

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Question: If A invests $40,000 and B invests $60,000 in a business, and they earn a profit of $20,000, how much profit will B receive?

Options:

Correct Answer: $12,000

Solution:

Total investment = 40000 + 60000 = 100000. B\'s share = (60000/100000) * 20000 = $12,000.

If A invests $40,000 and B invests $60,000 in a business, and they earn a profit of $20,000, how much profit will B receive?

If A invests $40,000 and B invests $60,000 in a business, and they earn a profit of $20,000, how much profit will B receive?

Correct Answer: $12,000

Step 1: Identify the amount A invested, which is $40,000.
Step 2: Identify the amount B invested, which is $60,000.
Step 3: Calculate the total investment by adding A's and B's investments: $40,000 + $60,000 = $100,000.
Step 4: Determine B's share of the total investment by dividing B's investment by the total investment: $60,000 / $100,000.
Step 5: Calculate B's share of the profit by multiplying B's share of the investment by the total profit: (60,000 / 100,000) * $20,000.
Step 6: Simplify the calculation: 0.6 * $20,000 = $12,000.
Step 7: Conclude that B will receive $12,000 in profit.

Profit Sharing – Understanding how profits are distributed based on the proportion of investment.
Ratios and Proportions – Calculating shares of profit using ratios of individual investments to total investment.