Question

6) If the gross profit is 20% of cost of goods sold and sales are * 1,00,000; the amount of
gross profit will be
(a) *20,000.
(6) * 25,000.
(c) * 16,667.
(d) None of these.​

Answer 1

ANSWER :

• (c) Rs. 16,667

★ The gross profit is 20% of cost of goods sold and sales are Rs. 1,00,000; the amount of gross profit will be Rs. 16,667.

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EXPLANATION :

❒ Given :-

• Gross Profit is 20% of cost of goods sold

• Sales are Rs. 1,00,000

❒ To Find :-

• Gross Profit = ?

❒ Calculation :-

Let,

• The cost of goods sold = Rs. 100

The rate of Gross profit at cost of goods sold is 20%.

∴ Selling price = Rs. (100 + 30) = Rs. 130.

Hence,

• When selling price is Rs. 130, the profit = Rs. 30.

➨ When selling price is Rs. 1, the profit = Rs. $\dfrac{30}{130}$

∴ When selling price is Rs. 1,00,000, the profit = Rs. ($\dfrac{30}{130}$ × 100000 )

= Rs. 16666.666

= Rs. 16667

• ∴ Gross Profit = Rs. 16,667