Question

If the rate of gross profit on the sale is 20% and cost of goods sold is Rs. 1,00,000, then the amount of gross profit will be equal to

• A. Rs. 20,000
• B. Rs. 25,000
• C. Rs. 35,000
• D. Rs. 15,000

Answer 1

The correct option is B Rs. 25,000

20% on sales is equal to 25% on cost of goods sold. Gross profit = Rs. 1,00,000 X (25/100) = Rs. 25,000