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A Hydro Power Company earned some profit and announced to distribute 25% dividend to its shareholders. If a shareholder who bought 1,200 shares out of 15,000 shares sold by the company received Rs 2,40,000. Calculate the net profit of the company.

(A) Rs 9,60,000
(B) Rs 10,00,000
(C) Rs 11,20,000
(D) Rs 12,00,000

User Per
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Final answer:

To calculate the net profit of the Hydro Power Company, we can deduce the profit per share from the dividend received by one shareholder and then extrapolate to find the total profit based on the number of shares. The net profit of the company is Rs 12,000,000.

Step-by-step explanation:

To calculate the net profit of the Hydro Power Company, we must first determine the total dividend paid to all shareholders and then use the dividend percentage to find the total profit. A shareholder who owns 1,200 shares received Rs 2,40,000, which is 25% of the profit corresponding to their shares.

Now, let's calculate the profit for one share. If 1,200 shares correspond to Rs 2,40,000, one share's profit is Rs 2,40,000 / 1,200 = Rs 200. Keep in mind this is 25% of the profit per share. Thus, the total profit per share is Rs 200 / 0.25 = Rs 800.

Since there are 15,000 shares sold by the company, we can calculate the total net profit by multiplying the profit per share by the total number of shares, which equates to Rs 800 * 15,000 = Rs 12,000,000.

User Jopa
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