A company earned a total revenue of =₦=108 million with a total cost of =₦=91 mi...
QuestionA company earned a total revenue of =₦=108 million with a total cost of =₦=91 million in 1991. If it paid 4596 tax on its gross profit for that year, determine its net profit.
The correct answer is C.
The question is asking us to determine the net profit of a company in 1991 given its total revenue, total cost, and tax paid. The company earned a total revenue of =₦=108 million and had a total cost of =₦=91 million. To calculate the gross profit, we need to subtract the total cost from the total revenue:
Gross Profit = Total Revenue - Total Cost = =₦=108 million - =₦=91 million = =₦=17 million
We are also told that the company paid a tax of =₦=4596 on its gross profit. To calculate the net profit, we need to subtract the tax paid from the gross profit:
Net Profit = Gross Profit - Tax Paid = =₦=17 million - =₦=4596 = =₦=9.35 million
Therefore, the correct answer is Option C: =₦=9.35 million. It is important to note that net profit is the amount of money a company makes after deducting all costs and expenses, including taxes, from its total revenue. To learn more about this, please read the relevant sections of the recommended textbooks.
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