Multiple Choice Questions on Net profit of a firm is rs79 800 Manager is entitled to a commission of 5 of profits after charging ........... for Commerce 12th Preparation

Accountancy ( 12th)

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Indian Economy - Understanding the basics of Indian economic system

Net profit of a firm is rs79,800. Manager is entitled to a commission of 5% of profits after charging his commission. Manager’s Commission will be :

4,200

380

3,990

3,800

- The problem requires calculating the manager's commission from net profit.

- The commission is set at 5% of the profit after the commission is deducted.

Let profit before duducting commision be X

X - X * R/(100+ R).= 79,800

X - X* 5/105 = 79800

100X/105 = 79800

X = 79800 * 105/100

X = 83,790

Manager commission = 83,790 - 79,800 = 3,990

- Solving: \( x = 0.05 \times (79,800 - x) \).

- This simplifies to \( x = 3,990 \).

- Option 3 is \( 3,990 \), which is the manager's commission.

The correct answer is:

\[ \textcolor{green}{\text{ Option 3: 3,990}} \]