Company A sells goods of Rs. 5,00,000 in the third quarter of the Fiscal year 2020-21. The cost price and additional expenses of goods are accounted to be Rs. 3,25,000. What will be the profit after tax if 25% of tax is levied?

  1. Rs. 1,31,250
  2. Rs. 1,75,000
  3. Rs. 1,40,250
  4. Rs. 1,30,750

Answer (Detailed Solution Below)

Option 1 : Rs. 1,31,250
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SSC CHSL Exam 2023 Tier-I Official Paper (Held On: 02 Aug 2023 Shift 1)
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Detailed Solution

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Given:

S.P. = Rs. 500,000

C.P. = Rs. 325,000

Tax% = 25%

Formula used:

Profit = S.P. – C.P.

Profit after tax = Profit × (1 – (Tax ÷ 100))

Calculations:

Calculating profit earned

⇒ Profit = 5,00,000 – 3,25,000

⇒ Profit = 1,75,000

⇒ Profit after tax = 1,75,000 × (1 – (25 ÷ 100))

⇒ Profit after tax = 1,75,000 × 3 ÷ 4

⇒ Profit after tax = 43,750 × 3

⇒ Profit after tax = 1,31,250

Profit after tax is Rs. 1,31,250

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