Use the following information to answer the given question: \(\begin{array}{c|c} & N \\ \hline \text{Stock at 1st Jan. 1901} & 6,500 \\ \text{Stock at 31st ...

To find the gross profit for the year, we need to know the cost of goods sold (COGS) first, which can be calculated using the following formula: COGS = Beginning Inventory + Purchases - Ending Inventory We are given the beginning and ending stock levels, but we need to calculate purchases. We can use the information about cash paid for goods during the year to calculate this: Purchases = Cash Paid + Ending Accounts Payable - Beginning Accounts Payable Plugging in the given values, we get: Purchases = 20,000 + 5,000 - 4,000 = 21,000 Now we can calculate COGS: COGS = 6,500 + 21,000 - 5,500 = 22,000 Finally, we can use the gross profit percentage given to calculate the gross profit: Gross Profit = COGS x Gross Profit Percentage Gross Profit = 22,000 x 0.25 = N5,500 Therefore, the answer is option D: N5,500.