Question

Capital Employed by Partnership firm is Rs. 5,00,000. Its Average Profit is 60,000. The normal Rate of return is 10%. The amount of Super Profit is

1 point

Rs. 50,000

Rs.10,000

Rs.6000

Rs.56,000​

Answer 1

10 thousand

Explanation:

normal profit=5,00,000×10÷100 =50,000

Super profit = actual profit-normal profit

=60,000-50,000

=10,000

Answer 2

GIVEN : Capital Employed = 5,00,000 ; Average Profit = 60,000 ; Normal Rate of Return = 10%

TO FIND : Super Profit

SOLUTION :

Super Profit = Average profit - Normal profit

As average profit is given in the question i.e. 60,000.

So we need to find Normal Profit firstly.

Normal Profit = Capital Invested × $\frac{Normal Rate of Return }{100}$

Capital Invested is 5,00,000 and Normal Rate of Return is 10%

Normal Profit  = 5,00,000 × $\frac{10}{100}$

                        = 50,000

Super Profit = Average profit - Normal Profit

                    = 60,000 - 50,000

                    = 10,000

Super Profit is 10,000 i.e. Option B is correct.