Sales ———————————– #50,000
Debtors ——————————– #10,000
Cash-in-hand ————————–#5,000
Opening stock ————————-#30,000
Creditors ——————————- #8,000
Purchases —————————– #16,000
Overdraft ——————————- #12,000
Closing stock ————————– #10,000
Calculate the gross profit.
- #35,000.00
- #20,000.00
- #15,000.00
-
#14,000.00
The correct answer is: D
Explanation
Gross Profit = Sales - Cost of Goods Sold (COGS)
COGS = Opening Stock + Purchases - Closing Stock
COGS = 30,000 + 16,000 - 10,000 = 36,000
Gross Profit = Sales - COGS
Gross Profit = 50,000 - 36,000 = #14,000