Step 1: Calculate the total capital contributed by all partners.
TotalCapital=PartnerA′sCapital+PartnerB′sCapital+PartnerC′sCapital
TotalCapital=K40000+K35000+K25000
TotalCapital=K100000
Step 2: Determine the proportion of each partner's capital to the total capital.
For Partner A:
ProportionA=TotalCapitalPartnerA′sCapital=K100000K40000=0.4
For Partner B:
ProportionB=TotalCapitalPartnerB′sCapital=K100000K35000=0.35
For Partner C:
ProportionC=TotalCapitalPartnerC′sCapital=K100000K25000=0.25
Step 3: Calculate each partner's share of the profit (K50 000) based on their capital proportion.
A) Partner A:
PartnerA′sShare=ProportionA×TotalProfit
PartnerA′sShare=0.4×K50000
PartnerA′sShare=K20 000
B) Partner B:
PartnerB′sShare=ProportionB×TotalProfit
PartnerB′sShare=0.35×K50000
PartnerB′sShare=K17 500
For completeness, Partner C's share would be:
PartnerC′sShare=ProportionC×TotalProfit
PartnerC′sShare=0.25×K50000
PartnerC′sShare=K12500
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