Roshan invests rs 240000 for 2 years at 10% per annum compounded annually. If their income tax is 20% is deducted at the end of each year on the interest accrued, find the amount he will receive at the end of two years?

Asked by aneesh382005 | 16th Jul, 2019, 02:23: PM

Expert Answer:

For the first year :
P = Rs. 240000, n = 1 and r = 10% p.a.
A = P(1 + r/100) 
A = 240000 (1 + 10/100)
A = Rs. 264000
Interest = 264000 - 240000 = Rs. 24000
Tax = 20/100 of 24000 = Rs. 4800
For second year : 
P = 264000 - 4800 = Rs. 259200, n = 1 year, r = 10% p.a.
A = 259200(1 + 10/100) 
A = Rs. 25920
Tax = 20% of 25920 = Rs. 5184
He received 285120 - 5184 = Rs. 279936 after two years.

Answered by Sneha shidid | 18th Jul, 2019, 10:05: AM