Blog

Shiv, Mohan and Gopal are partners sharing profits and losses in the ratio of 2: 2: 1 respectively. Shiv is entitled to a commission of 10% on the net profit. Net profit for the year is Rs. 1,10,000. Determine the amount of commission payable to Shiv.

SOLUTION

Net Profit before charging commission = Rs. 1,10,000
Commission to Shiv = 10% of on Net Profit before charging such commission  
Partner’ s Commission = (Net profit × rate of commission) / 100
Shiv ‘ s Commission = (1,10,000 × 10) / 100 = 11,000

Leave a Reply