(a) A man earns N150,000 per annum. He is allowed a tax free pay on N40,000. If he pays 25 kobo in the naira as tax on his taxable income, how much has he left?
(b) A bookshop has 650 copies of a book for sale. The books were marked at N75 per copy in order to make a profit of 30%. A bookseller bought 300 copies at 5% discount. If the remaining copies are sold at N75 each, calculate the percentage profit the bookshop would make on the whole.
Explanation
(a) Taxable income = (N150,000 – N40,000 = N110,000)
Tax payment = (N110,000 times 0.25 = N27,500)
Income left = (N(150,000 – 27,500) = N122,500)
(b) (% gain = frac{text{actual profit}}{text{cost price}} times 100%)
= (frac{SP – CP}{CP} times 100%)
(therefore frac{75 – CP}{CP} = frac{30}{100} implies 0.3CP = 75 – CP)
(1.3CP = 75 implies CP = N57.69)
Total cost price = (650 times frac{750}{13} = N37,500)
350 copies sold at N75 ==> (SP = 350 times N75 = N26,250)
300 copies sold at 5% discouunt ==> ((75 – frac{5}{100} times 75) times 300)
= ((75 – 3.75) times 300 = N21,375)
Total selling price = (N(26,250 + 21,375) = N47, 625)
Profit = (N(47,625 – 37,500) = N10,125)
(% = frac{10,125}{37,500} times 100% = 27%)