Multiple choice

Two companies A and B invest Rs. 20 lacs and Rs. 35 lacs respectively in a joint venture with the agreement that the profit or loss will be shared in the same ratio as the amount invested. If company B gets a profit of Rs. 14 lacs, the total profit of the joint venture is:

  1. 26 lacs

  2. 23 lacs

  3. 22 lacs

  4. 21 lacs

  5. 18 lacs
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Investment ratio A:B = 20:35 = 4:7. Profit is shared in the same ratio. B's profit = 7 parts = 14 lacs. 1 part = 2 lacs. Total profit = 4 + 7 = 11 parts = 11 * 2 = 22 lacs.

AI explanation

The investment ratio of company A to B is 20 lacs to 35 lacs, which simplifies to 4:7. Since company B's profit of 14 lacs represents 7 parts of this ratio, one part is equal to 2 lacs. The total profit is the sum of all ratio parts (4 + 7 = 11), so multiplying 11 parts by 2 lacs gives the total profit of 22 lacs.

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