*Partnership:*When two or more than two persons run a business jointly, they are called*partners*and the deal is known as*partnership*.*Ratio of Divisions of Gains:*- When investments of all the partners are for 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*. - When investments are for different time periods, then equivalent capitals are calculated for a unit of time by taking (capital x 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*.

- When investments of all the partners are for the same time, the gain or loss is distributed among the partners in the ratio of their investments.Suppose A and B invest Rs.
*Working and Sleeping Partners:*A partner who manages the the business is known as a*working partner*and the one who simply invests the money is a*sleeping partner*.

1. A and B invest in a business in the ratio 3 : 2. If 5% of the total profit goes to charity and A’s share is Rs. 855, the total profit is: A. Rs. 1425 B. Rs. 1500 C. Rs. 1537.50 D. Rs. 1576 Answer: Option B

Explanation:

Let the total profit be Rs. 100.

After paying to charity, A’s share = Rs. 95 x 3 = Rs. 57. 5 If A’s share is Rs. 57, total profit = Rs. 100.

If A’s share Rs. 855, total profit = 100 x 855 = 1500. 57