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Abha, Bobby and Vineet are partners sharing profits and losses equally. As per Partnership Deed, Vineet is entitled to a commission of 10% on the net profit after charging such commission. The net profit before charging commission is Rs. 2,20,000.Determine the amount of commission payable to Vineet.

SOLUTION

Net Profit before charging Commission = Rs. 2,20,000
Commission to Vineet = 10% of on Net Profit after charging such commission
Partner’ s Commission = (Net profit × Rate of commission) /  (100+Rate of commission)
Vineet’s Commission = (2,20,000 × 10) /  (100+10) = 20,000


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