CAT Exam Model Paper 1 with solutions for free online practice

Question : 87 of 100

Marks: +1, -0

A sales executive gets 20% bonus of the total sales value and 10% commission besides the bonus on the net profit after charging such commission.
If the total sales value be ₹ 10 lakh per annum and the total profit of the company be ₹ 1.32 lakh, then his total earning per annum will be, given that he is not entitled to receive any fixed salary’ from the company.

2.3 lakh
3.2 lakh
2.32 lakh
2.12 lakh

Validate

Solution:

(d) Bonus =

{ 20 × 10,00,000 } /{ 100 } = 2

lakh
But total profit = net profit +

10/100

× net profit
⇒ 1.32 lakh = 1.1 × Net profit
⇒ Net profit = 1.2 lakh = 1,20,000
∴ Commission = Total profit − Net profit
= 1,32,000 − 1,20,000 = 12,000
Hence, total earning = 2,00,000 + 12,000 = 2,12,000

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