Question

Directions for questions 35 to 40: Study the following details about a family's monthly income and expenditure and answer the question that follows.

Income	Amount / Rate
Basic salary	Rs. 5,000
Petrol allowance	20% of basic salary
PF deduction	10% of basic salary

Expenditure	Share of net income
Food	28%
House rent	22%
Entertainment	12%
Children's Education	25%
Other expenses	13%

How much is the PF deduction?

• A. Rs. 500
• B. Rs. 600
• C. Rs. 1000
• D. Rs. 1200

Hint:

The PF deduction is a percentage of the basic salary only, not of the gross or net income.

Answer 1

The Correct Option is A

Step 1: Use the fact that PF is the only gap between gross and net income.
The gross income comes from adding a 20 percent petrol allowance to the basic salary, and the net income comes from removing the PF percentage from that same basic salary.

Step 2: Write both incomes in terms of the basic salary.
\[ \text{Gross} = 5000 + 0.20(5000) = 6000 \]
\[ \text{Net} = 5000 \times 1.10 = 5500 \]

Step 3: Find PF as the difference between gross income and net income.
\[ 6000 - 5500 = 500 \]
This confirms directly that Rs. 500 is removed to go from the gross figure to the net figure, and this removed amount is exactly the PF deduction.

Final Answer:
The PF deduction each month is Rs. 500. \[ \boxed{Rs.\ 500} \]