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A and B have capitals (₹50000) and (₹150000). Profit is shared equally. After interest on capital (12%), residual profit is (₹44000). What was total profit?

Answer and explanation

Correct answer: (₹68000)

Direct answer: Option A, ₹68,000. Interest on A's capital is 12% of ₹50,000 = ₹6,000. Interest on B's capital is 12% of ₹1,50,000 = ₹18,000. Thus total interest on capital is ₹24,000. The residual profit after charging this interest is ₹44,000, so total profit before the interest charge was ₹24,000+₹44,000=₹68,000. Equal sharing of the residual profit does not change the total; each partner would receive ₹22,000 from the residual, but the question asks total profit. Option A is correct. Option B, ₹62,000, subtracts instead of adding the interest. Option C, ₹74,000, uses an incorrect interest amount. Option D, ₹56,000, also does not restore the ₹24,000 interest to the residual profit. Memory cue: total profit = interest on capital + residual profit, after calculating each interest carefully.

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