Profit and Loss – Advertising revenue needed to hit a target profit margin on sales: Fixed setup cost = ₹ 2800. Variable costs per 100 copies: paper/ink ₹ 80 and printing ₹ 160 (so ₹ 240 per 100 = ₹ 2.40 per copy). Last month, 2000 copies were printed but only 1500 copies were sold at ₹ 5 each. If total profit realized is 25% of the sales revenue, how much money came from advertising?

Introduction / Context:
The magazine has fixed and variable costs; only 1500 copies are sold, creating sales revenue. An additional income stream is advertising. The statement “25% profit on the sale price” is interpreted as profit being 25% of sales revenue (i.e., profit margin on sales). We use this to find the advertising amount that reconciles revenue and cost.

Given Data / Assumptions:

• Setup cost = ₹ 2800 (fixed)
• Variable cost per copy = ₹ 2.40
• Printed = 2000 copies
• Sold = 1500 copies at ₹ 5 each ⇒ sales revenue = ₹ 7500
• Profit = 25% of sales revenue

Concept / Approach:
Compute total cost: fixed + variable on all printed copies. Let A be ad revenue. Then total revenue = 7500 + A. Profit = total revenue − total cost. Set profit equal to 25% of sales revenue and solve for A.

Step-by-Step Solution:
Variable cost = 2000 * 2.40 = ₹ 4800Total cost = 2800 + 4800 = ₹ 7600Sales revenue = 1500 * 5 = ₹ 7500Let ad revenue = A ⇒ Profit = (7500 + A) − 7600 = A − 100Given Profit = 25% of 7500 = ₹ 1875 ⇒ A − 100 = 1875 ⇒ A = ₹ 1975

Verification / Alternative check:
Total revenue = 7500 + 1975 = 9475; profit = 9475 − 7600 = 1875, which is exactly 25% of 7500.

Why Other Options Are Wrong:
₹ 1750, ₹ 2350, ₹ 1150, and ₹ 1500 do not satisfy the profit-equals-25%-of-sales condition when costs are included.

Common Pitfalls:
Using 25% of total revenue instead of sales revenue; ignoring the variable cost for all printed copies, including unsold ones.

Final Answer:
₹ 1975