Basic Formulas of Partnership
The following are the formulas relevant to Partnership questions:
| S.No | To Calculate | Formulas |
|---|---|---|
1 |
If we consider X and Y as two contributors who contribute P and Q amount respectively for a year in a particular business, then their profit or loss earned at that time will be: |
X’s profit or loss: Y’s profit or loss = P : Q |
2 |
In a compound partnership, the money is invested during different periods of time by multiple investors. The benefit-sharing proportion is ascertained by duplicating the capital contributed with the unit of time (generally months). |
P1 : P2 = C1 × T1 : C2 × T2 |
Where
P1 = Partner 1's Profit.
C1 = Partner 1's Capital.
T1 = Time period for which Partner 1 contributed his capital.
P2 = Partner 2's Profit.
C2 = Partner 2's Capital.
T2 = Time period for which Partner 2 contributed his capital.
Quick Tip: Do you know? You can learn Partnership formulas quickly if you first understand the fundamental concepts of Partnership.
FAQsFAQs
How do you benefit from learning Partnership formulas?
One of the significant benefits of understanding Partnership formulas is the capability to quickly and accurately address simple formula-based questions.
How to remember Partnership formulas for a longer time?
Following are the techniques you can use to memorise Partnership formulas:
For a start, you can start understanding the concepts of the Partnership. It will help you find out why a formula is used.
Keep a separate piece of paper and write down each formula on the Partnership topic you need to memorise.
Write down and examine each Partnership formula, but this time with intervals. Write the equation, then take a 2-minute break to think about it before writing it again.
Your memory is more likely to associate with the formula you want to remember if you use it more often. Solve the problems employing the formula.
Visualise and repeat out loud the formula occasionally. Create Partnership formulas flashcards to help with this. You can also use these flashcards while practicing the Partnership questions.
The formula should be written down and posted somewhere you will see daily. They'll be subconsciously imprinted into your memory.
How conceptual understanding of the Partnership topic helps in remembering its formulas?
Conceptual understanding will help you to make sense of the Partnership formulas. Conceptual understanding is concentrated on describing why things happen as opposed to how to make them happen. They help you understand the true motive for employing the Partnership formulas.
