Calculate compensation of employees from the following items :
| Items | Rs in Crores |
| Profit after tax | 20 |
| Interest | 45 |
| $GDP_{MP}$ | 200 |
| Goods and service tax | 10 |
| Depreciation | 50 |
| Rent | 25 |
| Corporate tax | 5 |
Choose the correct option.
Answer & explanation
Correct answer: option 1
The correct answer is option (1) : 45 crores
Compensation of Employees = GDP at MP - (Profit after tax + Interest + Goods and Service Tax + Depreciation + Rent + Corporate tax)
Given:
- Profit after tax = Rs 20 crores
- Interest = Rs 45 crores
- Goods and Service Tax = Rs 10 crores
- Depreciation = Rs 50 crores
- Rent = Rs 25 crores
- Corporate tax = Rs 5 crores
- GDPMP = Rs 200 crores
Substitute the values into the formula:
Compensation of Employees = 200 - (20 + 45 + 10 + 50 + 25 + 5) = 200 - 155 = Rs 45 crores
So, the correct option is: 45 crores