ADIB has signed a Musharaka contract with ADIA. ADIB provided 1 % capital contribution in the project and agreed to the same profit-sharing percentage (1%). In addition, ADIB appointed ADIA as a professional manager on a fee-based arrangement to manage the project. The fee is agreed to be AED 467 per year. Suppose that at the end of the first year the project generates a profit of AED 15380. What will be total profit of ADIA?

Also, provide details of calculations if the amount mentioned above as profit in the end of first year was instead a loss at the end of first year.

Answer rating: 100% (QA)

Firstly we need to understand what Musharaka is Musharaka is an Islamic finance concept involving a ... View the full answer