Distribution Ratio

The distribution ratio refers to how a total amount of a resource, such as profits, expenses, or assets, is divided among different parties or accounts. It’s a way to determine each party’s share based on a specific formula, often proportional to their involvement or investment. For example, if two partners own a business equally and it earns $10,000, each would receive a distribution ratio of 1:1, meaning each gets $5,000. This concept helps ensure fair and transparent sharing of resources according to agreed-upon terms.