Commerce Accountancy · Banking Financial Awareness

Corporate Profit and Loss

189 Questions

Corporate profit and loss questions evaluate financial literacy through profitability ratios and investment returns. These concepts help assess the financial health of a business entity. The topic is essential for commerce students and banking aspirants.

Profitability index ratiosReturn on equityNet earnings formulasGross profit analysisAdvertising ROI calculations

Corporate Profit and Loss Questions

Multiple choice

As per the Railway Budget 2007-08 what has been the Cash Profit of the Indian Railways for the year 2006-07?

  1. Around Rs. 10,000 crore

  2. Around Rs. 15,000 crore

  3. Around Rs. 20,000 crore

  4. Around Rs. 25,000 crore

  5. Around Rs. 30,000 crore
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

In the 2007-08 Railway Budget, the Indian Railways reported a cash profit of approximately Rs. 20,000 crore for the fiscal year 2006-07, marking a significant turnaround for the organization at that time.

Multiple choice

The cost function for a product in a firm is given by 5q2, where q is the amount of production. The firm can sell the product at a market price of Rs. 50 per unit. The number of units to be produced by the firm such that the profit is maximized is

  1. 5

  2. 10

  3. 15

  4. 25
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Profit = Revenue - Cost = (Price * q) - (5 * q^2) = 50q - 5q^2. To maximize profit, take the derivative with respect to q and set to zero: 50 - 10q = 0, so q = 5.

Multiple choice

One unit of product P1 requires 3 kg of resource R1 and 1 kg of resource R2. One unit of product P2 requires 2 kg of resource R1 and 2 kg of resource R2. The profits per unit by selling product P1 and P2 are Rs. 2000 and Rs. 3000 respectively. The manufacturer has 90 kg of resource R1 and 100 kg of resource R2.

The unit worth of resource R2 i.e., dual price of resource R2 (in Rs. per kg) is

  1. 0

  2. 1350

  3. 1500

  4. 2000
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Multiple choice

Return on Shareholder’s Funds =
  1. $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} + 100 $
  2. $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} - 100 $
  3. $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} \times 100 $
  4. $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} \div 100 $
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Correct Answer: $ \frac{Net\ Profit\ after\ interest\ and\ Tax}{Shareholder's\ Funds} \times 100 $

Multiple choice

At the end of the year 2008-09, the ledger of a firm shows the following balances in their balance sheet:

 
Capital 2,00,000
Profit for the year 1,50,000
Provision for tax 75,000
Liabilities 1,00,000
Advance tax paid 60,000
Sundry assets 4,65,000

The total balance sheet would be

  1. Rs. 4,65,000

  2. Rs. 5,25,000

  3. Rs. 5,65,000

  4. Rs. 5,10,000
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Assets = Advance tax + sundry assets, i.e. Rs. 5,25,000. The same are the liabilities which include Capital + Profit + Provision + Liabilities.

Multiple choice elements of book keeping and accountancy accounting from incomplete records ascertaining profit or loss from incomplete records meaning and preparation of statement of profit meaning of incomplete records, reasons for incompleteness and its limitations preparation of final accounts from incomplete records preparation of statement of affairs introduction to single entry system and difference between single entry and double entry system meaning and featuresof incomplete records

Find the total at assets at the end of the year if the net profit, drawing during the year and assets at the beginning of the year were 12,000, 7,000 and 15,000 respectively.

  1. 20,000

  2. 10,000

  3. 9,000

  4. 8,000
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Calculation of total assets at the end of the year :- 

 Assets in the beginning of the year =Rs 15000
Less : Drawing made during the year (7000)
Add : Net profit for the year                  12000
                                                            = Rs 20000

Multiple choice business mathematics and statistics applications of calculus revenue functions from marginal revenue functions minimization of cost function and maximization of revenue function and profit function integral calculus – ii
A firm $ABC$ starts producing pens and finds that the production cost of each pen is Rs $10$, and the fixed expenditures of production is Rs. $4500$. If each pen is sold for Rs. $25$, find Revenue function
  1. $25x$
  2. $10x$
  3. $4500x$
  4. $4500+10x$
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

R(x)= ( price per unit)*(number of units produced or sold)
Revenue function = $25 \times x$ (number of units)
Revenue function =$25x$

Multiple choice book keeping and accountancy sub-division of journal - 2 (subsidiary books) explain the importance of preparing subsidiary books meaning and advantages of subsidiary books purchase book or purchase journal

If the purchases made during the year were Rs. 60, 000, the balance of stock in trade at the beginning and at the end of the year were Rs. 12, 000 and Rs. 9, 000 respectively and the gross profit on sales was 1/5th, when which one of the following represent :-

  1. Rs. 15, 750

  2. Rs. 14, 000

  3. Rs. 12, 500

  4. Rs. 17, 250
Reveal answer Fill a bubble to check yourself
C Correct answer
Multiple choice investement and financial planning banking compound interest comparing quantity maths

A $500 investment and a $1,500 investment have a combined yearly return of 8.5 per cent of the total of the two investments. If $500 investment has a yearly return of 7 per cent, what per cent yearly return does the $1,500 investment have?

  1. $9$
  2. $10$
  3. $11$
  4. $11\displaystyle \frac{1}{9}$
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Total investment by A=$500+1500=2000$
Yearly return =8.5 % of 2000
$\Rightarrow \frac{8.5}{100}\times2000=170$
Yearly return of 500=7% of 500
$\Rightarrow \frac{7}{100}\times500=35$
Let yearly return of 1500 is x
Yearly return=x% of 1500
$\Rightarrow \frac{x}{100}\times 1500=15x$
Then according to the question
$\Rightarrow 35+15x=170$
$\Rightarrow 15x=170-35$
$\Rightarrow 15x=135$
$\Rightarrow x=\frac{135}{15}=9$
                     

Multiple choice business mathematics and statistics applications of calculus marginal income and marginal cost to find the maximum profit if marginal revenue and marginal cost function are given: integral calculus – ii

The cost function of a firm $C(x)=2x^2-4x+5$. Find the average cost when $x=10$.

  1. $16.5$
  2. $15.5$
  3. $12.5$

  4. None of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

$\Rightarrow$  We have, $C(x)=2x^2-4x+5$.

$\Rightarrow$  Average cost = $\dfrac{C(x)}{x}$

$\Rightarrow$  Average cost = $\dfrac{2x^2-4x+5}{x}$

$\Rightarrow$  Average cost = $2x-4+\dfrac{5}{x}$

$\Rightarrow$  Substitute value of $x=10$.
$\Rightarrow$  Average cost = $2\times 10-4+\dfrac{5}{10}=20-4+0.5=16.5$
$\therefore$  $ Average\, cost = 16.5$