find the profit to the nearest dollar when the profit is 10% of income,expenses=30000'and taxes=5000

Question

I need to find the profit when the profit is 10% of the income the expenses=30000 and the taxes=5000

Answer 1

Bekkah,

 

Let's assume that Profit = Income - Expenses - Taxes and use P = I - E - T as our first equation.  Then substitute 30000=E and 5000=T so P = I - 35000.

 

Our second equation is that Profit = 10% of Income or P = (.1)I as our second equation.  Since we need to solve for I, lets replace P in the first equation with (.1)I so

 

(.1)I = I - 35000 or 35000 = .9(I) or I = 35000/(.9) = 38,889 (FYI, the Profit would be 3,889)

 

More generally, think about it this way.  Profit is everything you take in (income) less all of your costs and expenses, so if you take in 100% (income), and have 10% left as profit, then your all of your costs and expenses have to subtract out 90% of the income: 

100% (Income) - 90% (Income) = 10% (Income) and

Income - [Expenses and Taxes] = Profits, so

Expenses and Taxes = 90% of the Income so 35000 = .9 (Income)

 

Stay warm, and I hope this helps.