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A and B share profits in the ratio 3:2. A has a minimum income guarantee of ₹50000 including salary and profit share. A's salary is ₹20000 and total profit is ₹100000. Is any extra guarantee payable?

Answer and explanation

Correct answer: No because A's total income is ₹68000

After salary the remaining ₹80000 gives A share of ₹48000. Total income is ₹68000 so it exceeds the guarantee.

Related tags

PartnershipGuaranteeTotal IncomeAdjustmentsPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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