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A receives a salary of Rs 60,000 and B is paid a 16% commission on the profit remaining after this salary is deducted. Profit before salary is Rs 410,000. What is B's commission?

Answer and explanation

Correct answer: Rs 56,000

First deduct the salary: 410,000 − 60,000 = 350,000. B's commission = 16% of the remaining profit = 0.16 × 350,000 = 56,000. Hence B's commission is Rs 56,000. Why other options are wrong: option B (65,600) arises from mistakenly applying 16% to the pre-salary profit (410,000). Option D (60,000) is just A's salary, not a commission. Exam tip: always perform deductions in the order stated before calculating any percentage-based commission.

Related tags

SalaryCommissionProfit DistributionPartnership AccountsAccountancyPartnership Accounts Basic ConceptsClass 12 Mcq

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