Question

If the rate of gross profit is 25% on cost by goods sold and the sales are Rs. 2,00,000 the amount of profit will be ___________.

• A. Rs. 50,000
• B. Rs. 40,000
• C. Rs. 45,000
• D. Rs. 65,000

Answer 1

The correct option is B Rs. 40,000

This can be simply calculated as :

Cost + Gross Profit=Sales

Assuming the cost is 100, than gross profit becomes 25

Hence

100+25= Sales i.e. 200000

therefore

200000/125*25= Rs.40000/-

Gross profit will be Rs.40000