Partnership • Topic 3 of 3

Working & Sleeping Partner

A sleeping (or dormant) partner only contributes capital; a working (or active) partner also runs the business, so they are paid extra — a fixed salary or a commission on profit — before the remaining profit is divided by capital-months. The order is strict and where most marks are lost: take the salary/commission off the top FIRST, then split what is left in the capital ratio. If A is the working partner drawing a 10% commission on a ₹50,000 profit, ₹5,000 goes to A as commission, and only the remaining ₹45,000 is shared by capital. Note that the working partner usually also shares the remainder by capital, so A’s total = commission + capital share. CAT phrasings to watch: "a monthly salary of ₹X" means multiply by the months worked before deducting; "commission of r% of profit" is r% of the gross profit unless stated otherwise. Read whether the commission is on the whole profit or only on the balance — it changes the answer.

✅ Solved examples

1. A and B invest equally. A, the working partner, takes 15% of profit as salary; the rest splits equally. If total profit is ₹40,000, find A’s total.
Salary = 15% of 40000 = ₹6,000. Balance = ₹34,000 split equally ⇒ ₹17,000 each. A = 6000 + 17000 = ₹23,000.
2. P (working) and Q invest ₹60,000 and ₹40,000. P gets 10% commission on profit; balance splits by capital. Profit ₹50,000. Find Q’s share.
Commission = ₹5,000 to P. Balance = ₹45,000 in 60 : 40 = 3 : 2. Q = (2/5)×45000 = ₹18,000.
3. A invests ₹80,000, B ₹1,20,000. B is the working partner with a salary of ₹2,000/month for the year; rest splits by capital. Profit ₹60,000. Find each total.
B’s salary = 2000×12 = ₹24,000. Balance = ₹36,000 in 80 : 120 = 2 : 3. A = (2/5)×36000 = ₹14,400; B = ₹24,000 + (3/5)×36000 = 24000 + 21600 = ₹45,600.
4. Three partners A, B, C invest ₹50,000, ₹50,000, ₹1,00,000. C (working) takes 20% of profit, rest by capital. Profit ₹1,00,000. Find C’s total.
C’s commission = ₹20,000. Balance ₹80,000 in 1 : 1 : 2 (parts 4) ⇒ one part ₹20,000. C’s capital share = 2 parts = ₹40,000. C total = 20000 + 40000 = ₹60,000.

✏️ Practice — try these, take hints as needed

1. A (working) takes 12% of a ₹50,000 profit as salary; the balance splits equally with B. A’s total?
Salary = 12% of 50000 = 6000.
Balance = 44000, split equally.
6000 + 22000.
₹28,000
2. P ₹30,000, Q ₹50,000; P (working) gets 10% commission, rest by capital. Profit ₹40,000. P’s total?
Commission = 4000.
Balance 36000 in 3 : 5.
P capital share = 3/8.
₹17,500
3. B is working partner, salary ₹1,500/month for a year; A and B invest ₹1,00,000 each; rest by capital. Profit ₹30,000. A’s share?
Salary = 1500×12 = 18000.
Balance = 12000 in 1 : 1.
A = half of balance.
₹6,000
4. A ₹40,000, B ₹60,000; A (working) takes 25% of profit, rest by capital. Profit ₹80,000. B’s share?
A’s commission = 20000.
Balance 60000 in 40 : 60 = 2 : 3.
B = 3/5 of balance.
₹36,000
5. C (working) gets 5% commission; A, B, C invest ₹20,000, ₹30,000, ₹50,000; rest by capital. Profit ₹1,00,000. C’s total?
Commission = 5000.
Balance 95000 in 2 : 3 : 5 (parts 10).
C = 5000 + 5 parts.
₹52,500

📝 Topic test — 8 questions

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