Musharaka Case Study 4 For more case studies : http://ifinanceexpert.wordpress.com/ Dr.

. Faleel Jamaldeen Partner admitted to the Joint venture Crescent Publisher in an Islamic book publishing company owned by Abdullah. Abdullah valued the business through a consultancy company and the current worth of the business is $ 25,000. Abdullah got a contract from an international publisher to publish the book in the local language. The contract is signed for one year and Abdullah is in need for $ 15,000 as working capital to run the operation. Abdullah approached his friend Anwar and Anwar agreed to become the partner under the Musharaka contract sharing profit and loss. The net income to be shared between the partners. Both agreed to share the profit and loss equally. 1. Find how much Abdullah and Anwar will get if the value of the joint venture is $ 50,000 at the end of the year. Find the profit rate for Anwar Increase in the capital need to be shared based on PLS not based on capital contribution. An increase in the value = 50,000 40,000 = 10,000 will be shared $ 5,000 for Abdullah and $ 5000 for Anwar. So Anwar will get $ 5000 + $ 15000 = $ 20,000 from the contract. The profit is 5000/15000 * 100 = 33.33% 2. Find if there is loss of $ 10,000 in the business The loss will be shared based on Capital contribution. Capital contribution Abduallah (60%) and Anwar (40%). So, Anwar will get (15,000 4000) = $ 11,000 at the end of the contract.