Explanation:

- The marked price (MP) is 50% above the cost price (CP), so MP = 1.5 × CP.

- A 25% discount is given, so the selling price (SP) = MP × 0.75.

- A 10% tax is added, making the sale price (final price) = SP × 1.10.

- We are given that this final sale price is Rs.85.5 more than the cost price (CP).

Let's solve:

1. Let CP be 'x'.

2. Marked price (MP) = 1.5x.

3. Selling price after discount = 1.5x × 0.75 = 1.125x.

4. Sale price with tax = 1.125x × 1.10 = 1.2375x.

5. This is Rs.85.5 more than cost price. So, 1.2375x = x + 85.5.

6. 0.2375x = 85.5.

7. x = 85.5 / 0.2375 = 360.

- The Cost Price is Rs.360.

- Option 1: Rs.390 (incorrect)

- Option 2: Rs.360 (correct)

- Option 3: Rs.420 (incorrect)

- Option 4: Rs.400 (incorrect)

- Option 5: None of these (incorrect)