Question

Calculate the amount of Profit after Tax if:
• Revenue from Operations: 4,00,000
• Cost of Revenue from Operations: \(20\%\) of Revenue from Operations
• Tax rate: \(50\%\)

• A. 80000
• B. 320000
• C. 160000
• D. 200000

Answer 1

The Correct Option is C

1. Calculate the Cost of Revenue from Operations: \[ \text{Cost of Revenue from Operations} = 20\% \times 4,00,000 = 0.2 \times 4,00,000 = 80,000 \] 2. Calculate the Profit before Tax: \[ \text{Profit before Tax} = \text{Revenue from Operations} - \text{Cost of Revenue from Operations} \] \[ = 4,00,000 - 80,000 = 3,20,000 \] 3. Calculate the Tax Amount: \[ \text{Tax} = 50\% \times \text{Profit before Tax} = 0.5 \times 3,20,000 = 1,60,000 \] 4. Calculate Profit after Tax: \[ \text{Profit after Tax} = \text{Profit before Tax} - \text{Tax} = 3,20,000 - 1,60,000 = 1,60,000 \] Thus, the amount of Profit after Tax is 1,60,000.