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If remaining profit is zero what will be final profit distribution?

Answer and explanation

Correct answer: Zero

The direct answer is option A: zero. “Remaining profit” is the amount left after all earlier adjustments or appropriations. If the remaining profit is zero, there is no amount available for a final distribution. Thus final profit distribution = ₹0. Option A is correct because it exactly states that nothing remains to be shared. Option B, ₹10,000 equally, invents an amount that is not present in the question. Option C, ₹5,000 in the capital ratio, is also impossible because a ratio can divide an amount but cannot create money when the amount is zero. Option D, profit in the bank ratio, is unrelated: profit is not distributed according to a bank balance ratio, and in any case the remaining profit is zero. In partnership accounts, first identify the amount actually available after adjustments; only then apply the agreed profit-sharing ratio. A zero amount divided in any ratio remains zero. Exam cue: never distribute a positive amount when the question clearly says that no balance remains.

Related tags

Zero ProfitProfit DistributionConcept

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