Revenue from operations ₹ 8,00,000; Gross profit ratio 32%; Indirect Exp. 10% of Gross profit and income tax 40%. What will be the amount of profit after tax?

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₹ 1,38,240 Explanation: Given: Revenue from operations = ₹ 8,00,000 Gross profit ratio = 32% Indirect expenses = 10% of gross profit Income tax = 40% 1. Gross Profit = 32% of ₹ 8,00,000 = ₹ 2,56,000 2. Indirect Expenses = 10% of ₹ 2,56,000 = ₹ 25,600 3. Profit before tax = Gross Profit - Indirect Expenses = ₹ 2,56,000 − ₹ 25,600 = ₹ 2,30,400 4. Income tax = 40% of ₹ 2,30,400 = ₹ 92,160 5. Profit after tax = Profit before tax - Income tax = ₹ 2,30,400 − ₹ 92,160 = ₹ 1,38,240

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