An (IFI) Islamic Financial Institution (IFI) invested in a two year project valued at USD.700,000 by providing 70% of the capital based on the Musharakah contract. At the end of the first year, the project value declined by 40%. What is the impairment loss of the project investment incurred by IFI?

A. Determine capital loss after First Year and impairment loss of the project investment incurred by IFI. Since the project remains viable, the loss is carried forward to the next period then the net asset value. (4 marks)

B In subsequent period, performance is measured based on the outstanding capital. On the other hand, if the project is abandoned leading to the termination of the Musharakah contract, the IFI claims should be only? (4 marks)

A and B established a company, if profit after first year was USD 900,000 find below: (10 marks)

How much A and B will get if profit sharing ratio between them is 75:25?

How much A and B will get if profit sharing ratio between them is 50:50?