A, B and C enter into a partnership and invest their capital in the ratio 1 : 2 : 3. Their period of investment are in the ratio 3 : 2 : 1. In what ratio would they distribute their profits?
Question
A, B and C enter into a partnership and invest their capital in the ratio 1 : 2 : 3. Their period of investment are in the ratio 3 : 2 : 1. In what ratio would they distribute their profits?
Solution 1
The profit distribution in a partnership is proportional to the capital invested and the time period of investment.
Step 1: Calculate the individual ratios of capital and time.
- The ratio of capital invested by A, B and C is 1:2:3.
- The ratio of time for which they invested is 3:2:1.
Step 2: Multiply the capital ratio and time ratio for each person to get the combined ratio.
- For A, it's 1 (capital) * 3 (time) = 3
- For B, it's 2 (capital) * 2 (time) = 4
- For C, it's 3 (capital) * 1 (time) = 3
So, the ratio in which they should distribute their profits is 3:4:3.
Solution 2
The profit distribution in a partnership is proportional to the product of the capital investment and the time period of investment.
Let's calculate this for each person:
- For A, the capital to time ratio is 1*3 = 3
- For B, the capital to time ratio is 2*2 = 4
- For C, the capital to time ratio is 3*1 = 3
So, the profit would be distributed in the ratio of 3:4:3.
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