READ THE FOLLOWING INFORMATION AND ANSWER THE GIVEN QUESTION.
ABC Ltd is running an advertising business. Encouraged by substantial profits, company decided to donate ₹1,00,000 to an old age home in the locality where the company had its head office. Following particulars are obtained from the company's books:
| PARTICULARS | YEAR 2021 Amount (₹) |
YEAR 2020 Amount (₹) |
| Revenue from operations | 18,00,000 | 15,00,000 |
| Other income | 60,000 | 30,000 |
| Expenses | 10,40,000 | 8,70,000 |
| Income Tax | 3,00,000 | 2,50,000 |
What is the profit after tax for the year 2021?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- ₹5,20,000.
Total revenue 2021 = 18,00,000 + 60,000
= ₹18,60,000
Total expenses = ₹10,40,000
Profit before tax = Total revenue - Total expenses
= 18,60,000-10,40,000
= ₹8,20,000
Profit after tax = Profit before tax - Income tax
= 8,20,000- 3,00,000
= ₹5,20,000