If a publishers sings on a game and funds the development, after the game is released how are the royalties payed out and how much are they 5%-10%?

Anywhere from 0% up to 35% depending on the type of publisher, the experience (fame) of the developer, the type of product and the amount of money paid for the development.

Dan Marchant
Obscure Productions (www.obscure.co.uk)
Game Development & Design consultant

http://dukenukem.typepad.com/game_matters/2003/12/royalties_and_a.html

Good stuff.

Yep very good reading. 30-50% for products you fund yourself (often called a co-publishing deal) is the next step up from the one Eazy-E_ is asking about. Then above that comes a distribution deal, where the "developer" is virtually the publisher, funding development, production (box, manual, CD etc) and sometimes even marketing.

Dan Marchant
Obscure Productions (www.obscure.co.uk)
Game Development & Design consultant