Solving Data Interpretation Profit and Investment Question

This question requires us to use the provided data from the table on company profits to calculate the total investment of company XYZ in a specific year, given its profit amount and the corresponding percentage profit.

First, let's look at the relevant data from the table for company XYZ in the year 2012:

From the table, we can see that the percentage profit earned by company XYZ in the year 2012 was 60%.

We are also given that the amount of profit earned by company XYZ in 2012 was Rs. 9 Lakh. Rs. 9 Lakh is equal to Rs. 9,00,000.

The formula for percentage profit is:

$$ \text{Percentage Profit} = \left( \frac{\text{Profit}}{\text{Investment}} \right) \times 100 $$

We need to find the total investment. We can rearrange the formula to solve for Investment:

$$ \text{Investment} = \left( \frac{\text{Profit}}{\text{Percentage Profit}} \right) \times 100 $$

Now, let's substitute the given values into the formula:

• Profit = Rs. 9,00,000
• Percentage Profit = 60%

$$ \text{Investment} = \left( \frac{9,00,000}{60} \right) \times 100 $$

Let's perform the calculation step-by-step:

First, divide the Profit by the Percentage Profit (as a decimal or keep it as percentage and multiply by 100 later):

$$ \text{Investment} = \frac{9,00,000}{60} \times 100 $$

$$ \text{Investment} = 15,000 \times 100 $$

Now, multiply by 100:

$$ \text{Investment} = 15,00,000 $$

So, the total investment made by company XYZ in 2012 was Rs. 15,00,000.

Summary of Calculation for Investment

Here is a quick summary of how the investment was calculated:

1. Identify the profit amount for company XYZ in 2012: Rs. 9,00,000.
2. Find the percentage profit for company XYZ in 2012 from the table: 60%.
3. Use the formula: Investment = (Profit / Percentage Profit) × 100.
4. Substitute values: Investment = (9,00,000 / 60) × 100.
5. Calculate the result: Investment = Rs. 15,00,000.

This result matches one of the given options.

Revision Table: Key Concepts

Additional Information on Profit and Investment

Understanding the relationship between profit, investment, and percentage profit is fundamental in business analysis and data interpretation questions. Profit represents the gain from an investment or business activity after deducting expenses. Investment is the capital put into the business or project.

Percentage profit provides a standardized way to compare the profitability of different investments or business activities, regardless of their absolute scale. A higher percentage profit generally indicates a more efficient or lucrative use of investment capital.

In these types of data interpretation problems, you often need to:

• Read and understand the data presented in tables or charts accurately.
• Identify the specific data points required for the question (e.g., profit percentage for a specific year and company).
• Recall or derive the correct formula relating the given quantities (Profit, Investment, Percentage Profit).
• Perform the necessary calculations carefully.

Remember that Profit can also be expressed as a percentage of Cost Price (Profit Margin) or Revenue. However, in the context of 'percentage profit earned' alongside investment, it usually refers to Profit as a percentage of Investment, or sometimes as a percentage of Revenue. The formula used in this solution, based on Investment, is the most common interpretation in such data interpretation questions unless specified otherwise.