P and Q started a business with respective investments of Rs. 4 lakhs and Rs. 10 lakhs. As P runs the business, his salary is Rs. 5000 per month. If they earned a profit of Rs. 2 lakhs at the end of the year, then find the ratio of their earnings?
Correct answer: D. 1 : 1
- A. 2 : 5
- B. 5 : 2
- C. 3 : 5
- D. 1 : 1
- E. None of these
Explanation
P's annual salary is Rs. 5000 x 12 = Rs. 60000, leaving Rs. 200000 - Rs. 60000 = Rs. 140000 to divide in the capital ratio 4:10 = 2:5. P receives Rs. 140000 x 2/7 = Rs. 40000 from this remainder, so P's total is Rs. 100000 and Q's is Rs. 100000, giving 1:1. Option a is a likely mistake from comparing only the capital investments and ignoring P's salary.
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