Use the following information to answer the given question \(\begin{array}{c|c} & N \\ \hline \text{Sales} & 14,600 \\ \text{Purchases} & 5,500 \\ \text{Ret...
Question 1 Report
Use the following information to answer the given question
\(\begin{array}{c|c} & N \\ \hline \text{Sales} & 14,600 \\ \text{Purchases} & 5,500 \\ \text{Return inward} & 150 \\ \text{Rent} & 2,000 \\ \text{Salaries} & 1,000 \\ \text{Discount received} & 400\\ \text{Closing stock} & 250 \\ \text{Opening stock} & 100\end{array}\)
Net profit is
Answer Details
To calculate the net profit, we need to subtract all the expenses from the total sales after adjusting for returns and discount received and adding the closing stock.
Total sales = 14,600
Less: Returns inward = 150
Net sales = 14,450
Add: Closing stock = 250
Gross profit = 14,700
Now, we need to subtract all the expenses from the gross profit to get the net profit.
Gross profit = 14,700
Less: Purchases = 5,500
Add: Opening stock = 100
Net purchases = 5,600
Add: Rent = 2,000
Add: Salaries = 1,000
Total expenses = 8,600
Net profit before discount received = 6,100
Add: Discount received = 400
Net profit = 6,500
Therefore, the net profit is N6,500. Hence, the correct option is (d).
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