Calculate the amount of tax to be paid in these questions

This article is in continuation to the last article focusing on the percentage topic. Here are some practice questions along with solutions that will help you in your preparation for the State government recruitment jobs.

1. Arun’s income is 150% of Bala’s income and Chandu’s income is 120% of Arun’s income. If the total income of Arun, Bala and Chandu is Rs 86,000, then find Chandu’s income.
a) Rs 34,000 b) Rs 35,000 c) Rs 36,000 d) Rs 37,000
Ans: c
Solution: Arun = 150% of Bala
Arun : Bala = 3 : 2
Chandu = 120% of Arun
Chandu : Arun = 6 : 5
Arun : Bala = (3 : 2)5
Chandu : Arun = (6 : 5)3
Arun : Bala : Chandu
= 15 : 10 : 18
43 –>; 86,000
1 –>; 2000
Chandu’s income = 18 × 2000 = Rs 36,000

2. A man spends 75% of his income. If his income increases by 28% and his expenditure increases by 20%, then what is the increase or decrease percentage in his savings?
a) 48% increase b) 52% increase c) 48% decrease d) 52% decrease
Ans: b
Solution: Income = Expenditure Savings
100 = 75 25
28 15 13
13/ 25 × 100% = 52%

3. The sum of the salaries of A and B together is Rs 4300. A spends 95% of his salary and B spends 80% of his salary. If their savings are the same, what is A’s salary?
a) Rs 3,440 b) Rs 3,330 c) Rs 3,445 d) Rs 3,335
Ans: a
Solution: 5% of A’s savings = 20% of B’s savings
5A = 20B
A/B = 20/5
A : B = 4 : 1
A B = 4300
5 –>; 4300
1 –>; 860
4 × 860 = 3440

4. A person pays a debit of Rs 8,960 per month for repayment of loan, which is 28% of his monthly salary. Calculate his monthly salary.
a) Rs 30,000 b) Rs 30,500 c) Rs 32,000 d) Rs 32,500
Ans: c
Solution: 28% = 8960
10% = 320
The monthly salary = 100 × 320 = 32,000

5. If the income tax is increased by 19%, the net income is reduced by 1%. Then the rate of income tax is?
a) 5% b) 6% c) 5.5% d) 6.5%
Ans: a
Solution: Tax × 19% = Net income × 1%
Tax/ Net income = 1/19
Total income = 20
Rate of income tax = 1/20 × 100% = 5%

6. If the rate of income tax is increased from 20% to 25%, find the additional amount of tax a person has to pay if his total income is Rs 40,000.
a) Rs 1,500 b) Rs 1,750 c) Rs 2,000 d) Rs 2,150
Ans: c
Solution: 25 – 20 = 5% = 5/100 = 1/20
Therefore, increase in tax amount = 1/20 × 40,000
= Rs 2,000

7. The income tax rate is increased from 4% to 5%, but the tax liability of a person is increased by 10% only. Find the percent decrease in his taxable income.
a) 10% b) 12% c) 13% d) 11%
Ans: b
Solution: Let tax in the first case = Rs 100
Then new tax = 100 × 5/4 = Rs 125
But actual revised tax = Rs 110
Reduced income = 110/125 × 100 = 88%
Decrease in income = 100 – 88 = 12%

8. Income tax rate is 20% in a particular year. If in the next year, a person’s income is increased by 25%, but total tax liability remains the same, find tax-rate during the next year.
a) 16% b) 18% c) 17% d) 15%
Ans: a
Solution: Ratio of income = 100 : 125
= 4 : 5
Ratio of tax rate = 5 : 4
5 –>; 20%
1 –>; 4%
4 –>; 4 × 4 = 16%

To be continued
M.Venkat
Director
MVK Publications
Dilsukhnagar
7671002120