High School

During the year, a shop had revenues of Rs. 125000; rent expenses Rs. 12000; salaries Rs. 25000; short-term investments Rs. 35000; and other expenses of Rs. 40000. What was the net income?

Rs. 48000
Rs. 85000
Rs. 60000
Rs. 13000

Answer :

To find the net income of the shop, we need to subtract the total expenses from the total revenues. Here's how you can calculate it step by step:

  1. Revenue: The total amount of money the shop earned during the year is Rs. 125,000.

  2. Expenses: The shop had several expenses:

    • Rent expenses: Rs. 12,000
    • Salaries: Rs. 25,000
    • Other expenses: Rs. 40,000

    We do not include short-term investments as expenses in calculating net income because they are typically considered an asset rather than a direct expense.

  3. Calculate Total Expenses: Add up all these expenses:

    [tex]Total\ Expenses = 12,000 + 25,000 + 40,000 = 77,000\ Rs[/tex]

  4. Calculate Net Income: Subtract the total expenses from the total revenue:

    [tex]Net\ Income = Total\ Revenue - Total\ Expenses = 125,000 - 77,000 = 48,000\ Rs[/tex]

Therefore, the net income for the shop is Rs. 48,000.

Based on the options provided, the correct answer is Rs. 48,000.

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