Vijay and Manohar share profits and losses in the ratio of 2:1. They admit Prakash as a partner with 1/4 share in profits with a guarantee that his share of profit will be at least Rs. 50,000. The net profit of the firm for the year ending March 31, 2015, was Rs. 1,60,000. Calculate the amount of profit Vijay will get:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 73,333
When a new partner is guaranteed a minimum profit, any shortfall is borne by the partners who gave the guarantee, in their old ratio (here Vijay and Manohar, 2:1).
New ratio: Prakash 1/4; the remaining 3/4 is shared 2:1, so Vijay 2/4, Manohar 1/4 (2:1:1).
Prakash's share = Rs. 1,60,000 x 1/4 = Rs. 40,000; guarantee Rs. 50,000; deficiency = Rs. 10,000
Vijay's share of deficiency = Rs. 10,000 x 2/3 = Rs. 6,667
Vijay's profit = Rs. 1,60,000 x 2/4 - Rs. 6,667 = Rs. 80,000 - Rs. 6,667 = Rs. 73,333
NCERT (2026-27 edition):
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