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Question
Revenue from operations ₹ 4,00,000; Cost of revenue from operations 60% of revenue from operations, Indirect expenses 15% of gross profit; Income tax 40%. Calculate net profit after tax.
Options
₹ 64,000
₹ 54,000
₹ 81,600
₹ 96,000
MCQ
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Solution
₹ 81,600
Explanation:
Revenue from operations = ₹ 4,00,000
1. Cost of revenue from operations = 60% of ₹ 4,00,000 = ₹ 2,40,000
2. Gross profit = Revenue − Cost of revenue
= ₹ 4,00,000 − ₹ 2,40,000
= ₹ 1,60,000
3. Indirect expenses = 15% of Gross profit
= 15% of ₹ 1,60,000
= ₹ 24,000
4. Profit before tax = Gross profit - Indirect expenses
= ₹ 1,60,000 − ₹ 24,000
= ₹ 1,36,000
5. Income tax = 40% of Profit before tax
= 40% of ₹ 1,36,000
= ₹ 54,400
6. Net profit after tax = Profit before tax − Income tax
= ₹ 1,36,000 − ₹ 54,400
= ₹ 81,600
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