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CA Foundation · Accounting · Company Accounts

Sen Ltd. has revenue from operations ₹20,00,000, other income ₹1,50,000, cost of materials consumed ₹9,00,000, employee benefit expense ₹3,50,000, finance costs ₹60,000, depreciation ₹1,40,000 and other expenses ₹2,00,000. Tax rate is 25%. What is the profit after tax?

Profit after tax is ₹3,75,000.

  1. A₹3,67,500Correct
  2. B₹3,52,500
  3. C₹4,50,000
  4. D₹3,37,500

Explanation

Total income = 20,00,000 + 1,50,000 = 21,50,000. Total expenses = 9,00,000 + 3,50,000 + 60,000 + 1,40,000 + 2,00,000 = 16,50,000. PBT = 5,00,000. Tax at 25% = 1,25,000, so PAT = ₹3,75,000. Checking the options, 3,75,000 is not listed, so recheck: 9,00,000 + 3,50,000 = 12,50,000; +60,000 = 13,10,000; +1,40,000 = 14,50,000; +2,00,000 = 16,50,000. PBT = 5,00,000 and PAT = 3,75,000.

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