A and B enter into a partnership with capital in the ratio 5 : 6. After 4 months, A withdraws of his capital, while B increases his capital by 33%. What is the share (in Rs lakhs) of B in the annual profit of Rs 6.3 lakhs?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 3.96.
Here the initial ratio of investment of A and B is given which is 5 : 6.
Let the initial investment of A and B be 5x and 6x.
We know that,
Profit share = Investment × time period.
Profit share of A = 5x × 4 + 4x × 8 = 52x.
Profit share of B = 6x × 4 + 8x × 8 = 88x
Ratio of their profit share = 52x : 88x = 13 : 22.
Share of B in 6.3 lakh = 22/35 × 6.3 = 3.96 lakhs.