Revenue from operations is ₹40,00,000, other income is 10% of Revenue from Operations. Expenses are 40% of Revenue from Operations. Amount of Profit before Tax will be:

₹ 28,00,000

The correct answer is Option (2) - ₹ 28,00,000.

Revenue from operations = ₹40,00,000
Other income                  = 10% of Revenue from Operations
                                     = 10/100 x 4000000
                                     = 400000

Total revenue = Revenue from operations + Other income
                     = 4000000 + 400000
                     = ₹4400000

Expenses are 40% of Revenue from Operations
Expenses = 4000000 x 40/100
              = 1600000

Profit before tax = Total Revenue - Expenses
                        = 4400000 - 1600000
                        = 2800000