Use the following information to answer the question below
Trading Account of Umeh Enterprises for the year ended 31st December 2019
| GH⊄ | GH⊄ | ||
| Opening stock | 10000 | Sales | 200000 |
| Purchases | 120000 | Less: | (4000) |
| 130000 | 196000 | ||
| Closing stock | (22800) | ||
| Cost of goods sold | —– | ||
| Gross profit | —— | ||
| 196000 | 196000 |
A. GH⊄ 88,800
B. GH⊄ 43,200
C. GH⊄ 152,800
D. GH⊄ 107,200
Correct Answer:
Option A = GH⊄ 88,800
Explanation
Gross profit = (Sales + Return inward) – Cost of goods sold
= 196,000 – 107,200
= 88,800
