Question

Q12: A manager gets 5%
commission on net profit after
charging such
commission,gross profit
Rs.5,80,000 and expenses of
indirect nature other than
manager's commission are
Rs.1,60,000.Commission
amount will be
O 21,000
O 20,000
15,000
O 22,000​

Answer 1

Commission payable = 10% on Net Profit (after charging the commission)

If Net Profit is Rs. 100, Commission payable = Rs. 10

Thus profit before charging the commission = 100 + 10 = 110

Of Rs. 110, Rs. 10 is commission payable and the balance Rs. 110- Rs. 10 = Rs. 100 is the profit, left after charging the commission.

Here Rs. 2.200 is equal to 110%

Therefore 10% = 2,200/110 x 10 =Rs. 200

I hope you are understand my solution