MyMaths MyLife

When two or more than two persons run a business jointly, they are called partners and the deal is known as partnership.


Ratio of Division of Gains:
1.When the investments of all the partners are do the same time, the gain or loss is distributed among the partners in the ratio of their investments.

Suppose A and B invest Rs x and Rs y respectively for a year in a business, then at the end of the year:(A's share of profit):(B's share of profit)=x:y

2.When investments are for different time periods, then equivalent capitals are calculated for a unit of time by taking (capital*number of units of time). Now gain or loss is divided in the ratio of these capitals.

Suppose A invests Rs x for p months and B invests Rs y for q months, then (A's share of profit):(B's share of profit)=xp:yq

3.Working and sleeping partners:A partner who manages the business is known as working partner and the one who simply invests the money is a sleeping partner.

Formula:
1.When investments of A and B are Rs x and Rs y for a year in a
business ,then at the end of the year
(A's share of profit):(B's share of profit)=x:y

2.When A invests Rs x for p months and B invests Rs y for q months,
then A's share profit:B's share of profit=xp:yq