Question

Tax paid during the year ended 31^st March, 2023 was Rs.15,000. While calculating Net Profit before Tax and Extraordinary Items, the amount of provision for tax to be added is: (b) \[ \begin{array}{|c|c|c|} \hline \textbf{Particulars} & \textbf{1-4-2022} & \textbf{31-3-2023} \\ \hline \text{Provision for Tax} & \text{Rs.10,000} & \text{Rs.25,000} \\ \hline \end{array} \]

• A. Rs.30,000
• B. Rs.25,000
• C. Rs.10,000
• D. Rs.15,000

Hint:

Always adjust the tax provision changes with the tax paid during the year to calculate the total impact on net profit before tax.

Answer 1

The Correct Option is A

Provision for tax at the beginning of the year was Rs.10,000, and at the end of the year was Rs.25,000. The total tax provision to be added: \[ Rs.25,000 - Rs.10,000 + Rs.15,000 = Rs.30,000 \]