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Faleel Jamaldeen Case study 1 The Islamic bank entered an agreement with a corporation for joint venture project. Both the Islamic bank and corporation agreed to use their expertise in the project. 30% of management fee are to be apportioned from the profit of which 40% for bank and 60% for corporations. The balance is to be shared between Islamic banks and Corporation, based on their capital contribution. The total capital need to for the project is $ 800,000 of which Islamic bank contributed $ 500,000 and Corporation contributed $ 300,000. Find the income of the bank and corporation if the profit from the project is $ 300,000. 1. Find the Profit and Loss sharing ratio. Corporation 300/800 = 37.5%. Bank 500/800 = 62.5% 2. Bank Profit Management Fee 40% 36,000.0 Profit after management fee PLS 37.50% 78,750.00 62.50% 131,250.00 60% 54,000.0 90,000.0 Corporation 300,000

210,000.0

Income for partners

114,750.00

185,250.00