Question
If revenue from operations is Rs.60,00,000 Gross Profit ratio is 60%, Operating expenses are Rs.4,00,000 and Income tax rate is 30%, what will be the operating Profit?
Solution
Operating profit = Gross Profit – Operating expenses Gross Profit = Sales *Gross Profit ratio 60,00,000 *60% = 36,00,000 So, operating profit = 36,00,000 – 4,00,000 = 32,00,000
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