Partnership Questions and Shortcut Tricks

Partnership Solved Examples - Page 2
Partnership Important Questions - Page 3

When two or more than two persons run a business jointly. They are called partners and the deal is known as partnership. Partnership is of two kinds : (i) Simple and (ii) Compound.

Simple Partnership : If the capitals of the partners are invested for the same period the partnership is called simple.

Rule. When investment of all the partners are for the same time, the profit or loss is divided among them in the ratio of their investments.

Compound Partnership : If the capitals of the partners are invested for different lengths of time, the partnership is called compound.
Rule. When investment are for different times then equivalent capitals are calculated for a unit of time by multiplying the capital with the number of units of time. The profit or loss is now divided in the ratio of these capitals.

Note I. If A and B invested their capitals for different length of time, then Images
Note II. A partner who manages the business is called a working partner and the one who simply invests the money is called a sleeping partner.
Note III. In every examination the questions are generally set on compound partnership. But such questions are first converted into simple partnership and then solved.

 

Leave a Reply

Your email address will not be published. Required fields are marked *