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A and B's capitals are to be finally maintained in the ratio 5 : 3. The total adjusted capital is ₹1,60,000. What is A's target capital?

Answer and explanation

Correct answer: One lakh rupees

Total parts = 5 + 3 = 8. Value of one part = total adjusted capital ÷ total parts = ₹160,000 ÷ 8 = ₹20,000. Therefore A's target capital = 5 parts = 5 × ₹20,000 = ₹100,000. The closest distractor (₹120,000) is incorrect — it comes from an incorrect split such as treating denominator wrongly or allocating more than 5/8 of the total. Exam tip: divide the total by the sum of ratio parts first, then multiply by the required number of parts to avoid mistakes.

Related tags

Capital RatioTarget CapitalAdjustmentPartnership AccountsCapital AccountsRatioPartnership Accounts Basic ConceptsAccountancy

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