Question

X, Y and Z are sharing profit in the ratio 5:3:2. Minimum guarantee of profit to Z is Rs. 28000. Profit earned Rs. 100000. X's share of profit will be :​

Answer 1

ANSWER :

• ❖ If X, Y and Z are sharing profit in the ratio 5 : 3 : 2, minimum guarantee of profit to Z is Rs. 28,000 and Profit earned Rs. 1,00,000; then X's Share of Profit will be : Rs. 45,000.

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SOLUTION :

❒ Given :-

• X, Y and Z are sharing profit in the ratio 5 : 3 : 2.

• Minimum guarantee of profit to Z is Rs. 28,000.

• Profit earned by the firm is Rs. 1,00,000.

❒ To Calculate :-

• Share of profit of X = ?

❒ Note :-

• If a minimum amount of profit is guaranteed to a partner by the partnership firm; then the guaranteed amount of profit must be paid even if there is no profit or the profit is insufficient to give him the guaranteed minimum amount as his share of profit. So, when the actual share of profit of the guaranteed partner is less than the guaranteed amount of his share, then the deficiency will be borne by the remaining partners in their profit sharing ratio or in the agreed ratio, if any.

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❒ Calculation :-

Here,

• Profit Sharing Ratio of X, Y and Z = 5 : 3 : 2

• Profit Earned = Rs. 1,00,000

So,

• ★ Share of Profit of X = $\tt{\dfrac{5}{10}}$ of Rs. 1,00,000

➨ Share of Profit of X = $\tt{\dfrac{5}{10} \times Rs. \: 1,00,000}$

➨ Share of Profit of X = Rs. 50,000

And,

• ★ Share of Profit of Z = $\tt{\dfrac{2}{10}}$ of Rs. 1,00,000

➨ Share of Profit of Z = $\tt{\dfrac{2}{10} \times Rs. \: 1,00,000}$

➨ Share of Profit of Z = Rs. 20,000

Again,

• Share of Profit guaranteed to Z = Rs. 28,000

We can see that,

• ❍ The actual share of profit of Z is less than the guaranteed share of profit of Z. So, the deficiency will be borne by X and Y in their Profit Sharing Ratio.

Here,

• Actual Share of Profit of Z = Rs. 20,000

• Guaranteed Share of Profit of Z = Rs. 28,000

So,

• ✠ Deficiency = Guaranteed Share - Actual Share

➜ Deficiency = Rs. 28,000 - Rs. 20,000

➜ Deficiency = Rs. 8,000

• This deficiency of Rs. 8,000 will be borne by X and Y in the ratio of 5 : 3.

Thus,

• ⊚ Deficiency borne by X = $\tt{\dfrac{5}{8}}$ of Rs. 8,000

➞ Deficiency borne by X = $\tt{\dfrac{5}{8} \times Rs. \: 8,000}$

➞ Deficiency borne by X = Rs. 5,000

Now,

• Actual Share of Profit of X = Rs. 50,000

• Deficiency borne by X = Rs. 5,000

Hence,

• ✪ Share of Profit of X = Actual Share of Profit of X - Deficiency Borne by X

⇒ Share of Profit of X = Rs. 50,000 - Rs. 5,000

∴ Share of Profit of X = Rs. 45,000