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?

A. 2 : 5
B. 5 : 2
C. 3 : 5
D. 1 : 1
E. None of these

Explanation:

Ratio of investments of P and Q is 2 : 5

Total salary claimed by P = 12 * 5000 = Rs. 60000
Total profit = Rs. 2 lakhs.
Profit is to be shared = Rs. 140000
Share of P = (2/7) * 140000 = Rs. 400000
Share of Q = Rs. 100000
Total earnings of P = (60000 + 40000) = Rs. 100000
Ratio of their earnings = 1 : 1

Correct Answer: 1 : 1 ✔

Last Updated: February 07, 2020