Question 169

Raksha invested an amount of Rs. 60,000 to start a software business. After six months, Kamal joined her with an amount of Rs. 90,000. After one year from the commencement of the business, Raksha put in an additional amount of Rs. 20,000. At the end of three years, they earned a profit of Rs. 71,20,000. What is Raksha’s share in profit ?

Solution

The ratio of each person's share in the profit is proportional to the weighted average of investment amount and time.

Raksha's investment amount is 60000 for 3 years and 20000 for 2 years.
Kamal's investment amount is 90000 for 2.5 years.

Hence, the ratio is 60*3 + 20*2 : 90*2.5 = 220:225

Hence, Raksha's share in the profit is 7120000 * 220 /(220+225) = 7120000*220/445 = 3520000

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