If the opening inventory of a business is undercast, it will
A. Increase gross profit and decrease net profit
B. Decrease gross profit as well as net profit
C. Increase value of assets
D. Increase gross profit as well as net profit
Answer: Option D
Solution(By Examveda Team)
If the opening inventory of a business is undercast, it will Increase gross profit as well as net profit.This Question Belongs to Commerce >> Accounting
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Comments ( 2 )
Accounting provides information on
A. Cost and income for managers
B. Company's tax liability for a particular year
C. Financial conditions of an institutions
D. All of the above
The long term assets that have no physical existence but are rights that have value is known as
A. Current assets
B. Fixed assets
C. Intangible assets
D. Investments
The assets that can be converted into cash within a short period (i.e. 1 year or less) are known as
A. Current assets
B. Fixed assets
C. Intangible assets
D. Investments
Patents, Copyrights and Trademarks are
A. Current assets
B. Fixed assets
C. Intangible assets
D. Investments
1. Sales - Cost of Goods Sold = Gross Profit
2. Cost of Goods Sold = Opening Inventory + Purchases - Closing Inventory
If you substitute 2. above into 1. you get:
Gross Profit = Sales - (Opening Inventory + Purchases - Closing Inventory)
Gross Profit = Sales - Opening Inventory - Purchases + Closing Inventory
how i did not get it?